From the Chattanoogan: A $13 million settlement has been reached in a class action federal lawsuit brought against Chattanooga trucking firm U.S. Xpress.
Plaintiffs in the Litigation allege that “beginning in June 2018, U.S. Xpress made materially false and misleading statements and/or failed to disclose adverse information regarding the company’s business and operations, which caused the price of the company’s securities to trade at artificially inflated prices until November 2018, when the circumstances allegedly concealed by the allegedly misleading Offering materials were allegedly revealed, and the Company’s stock price significantly declined. Defendants deny each and all of Plaintiffs’ allegations in the litigation.”
Defendants “contend that they did not make any false or misleading statements, that they disclosed all information required to be disclosed by the federal securities laws, that the individual defendants at all times acted in good faith, that the underwriter defendants conducted a reasonable investigation leading up to the company’s initial public offering, that the price of the company’s securities were not artificially inflated, and that no decline in the company’s stock price resulted from defendants’ alleged wrongdoing.”
Judge Travis McDonough will hold a hearing on July 10 at 3 p.m. to determine whether to accept the settlement.
An order in the case says, “IF YOU PURCHASED OR OTHERWISE ACQUIRED USXPRESS CLASS A COMMON STOCK PURSUANT AND/OR TRACEABLE TO THE JUNE 14, 2018 OFFERING, YOUR RIGHTS ARE AFFECTED BY THE SETTLEMENT OF THIS LITIGATION.
“To share in the distribution of the Settlement Fund, you must establish your rights by submitting a Proof of Claim and Release form (“Proof of Claim”) by mail (postmarked no later than August 16, 2023) or electronically (no later than August 16, 2023). Your failure to submit your Proof of Claim by August 16, 2023, will subject your claim to rejection and preclude your receiving any of the recovery in connection with the Settlement of this Litigation. If you purchased or otherwise acquired USXpress Class A common stock pursuant and/or traceable to the June 14, 2018 Offering, and do not request exclusion from the Class, you will be bound by the Settlement and any judgment and release entered in the Litigation, including, but not limited to, the Judgment, whether or not you submit a Proof of Claim.”
In all, defendants and third parties produced more than 480,000 pages of documents, and the parties conducted nearly 35 fact and expert depositions in the case.
On November 16, 2021, both sides participated in a voluntary confidential mediation with mediator David M. Murphy.
Following the mediation and while continuing to litigate the case, the parties continued settlement discussions through attorney Murphy. On Dec. 15, 2022, on the eve of the deadline for filing motions for summary judgment, the parties agreed to settle the litigation in return for a cash payment of $13,000,000 for the benefit of the Class, subject to the negotiation of the terms of a Stipulation of Settlement and approval by the Court.”
A claims administrator, “subject to such supervision and direction of Class Counsel and the Court as may be necessary or as circumstances may require, shall administer and calculate the Claims submitted by Class Members and shall oversee distribution of the Net Settlement Fund to Authorized Claimants.”