Overview
In an order Monday, Judge Rakoff appointed retired California judge Jeffrey Tauber to be one of two co-lead plaintiffs in a securities fraud class action against (among others) a hedge fund that allegedly bought stock in Sigma Designs, Inc. while in possession of inside information about strong company performance. Judge Rakoff observed that Judge Tauber has "significant legal credentials and impressed the Court at the hearing as someone who will supervise his attorneys closely." Judge Tauber, like any other judge, will surely have no problem keeping a close watch on the lawyers. Judge Tauber is an unusal securities fraud victim. He bought over 22,000 shares of Sigma Designs, Inc. stock in July and August 2007 for around $31-33 per share, and sold it two months later for around $52 per share. (See here.) That's about a $400,000 profit in 60 days -- not bad for a judge. He and other sellers were allegedly defrauded because the hedge fund defendant bought shares knowing that Sigma Designs, Inc. would beat earnings expectations. The price stock of Sigma Designs, Inc. peaked shorty after Judge Tauber sold and now trades at under $5 per share (see here). In other words, being the victim of securities fraud seems to have worked out all right in this case.
