Perez v. Higher One Holdings, Inc.
3:14-cv-755-AWT

Frequently Asked Questions

 

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  • You or someone in your family may have purchased Higher One securities between August 7, 2012 through August 6, 2014 (the “Settlement Class Period”).

    The Court directed that the Notice be sent to Settlement Class Members because they have a right to know about the proposed Settlement of the class-action lawsuit and about all of their options before the Court decides whether to approve the Settlement. If the Court approves the Settlement and after objections and appeals—if any—are resolved, the Claims Administrator appointed by the Court will make the payments provided for in the Settlement.

  • This case is known as Perez v. Higher One Holdings, Inc., Case No. 3:14-cv-755-AWT (the “Action”). The United States District Court for the District of Connecticut is in charge of the Action and the case has been assigned to the Honorable Alvin W. Thompson.  

    This Action brings claims against Settling Defendants, Defendant Wolf, and former Defendant McFadden. Higher One provided technology-based refund disbursement, payment processing, and data analytics services to higher education institutions and students in the United States, including online checking accounts (called OneAccounts) and a MasterCard ATM debit card through its banking partners, which were regulated by federal banking regulators. Plaintiffs assert claims under Sections §§10(b) and 20(a) of the Securities Exchange Act of 1934, 15 U.S.C. §§ 78j(b) & 78t(a), and Securities and Exchange Commission Rule 10b-5, 17 C.F.R. § 240.10b-5.  Specifically, Plaintiffs allege that Higher One’s Pre-Class Period misconduct included improper marketing of and fees charged on OneAccounts and debit cards in violation of §5 of the Federal Trade Commission Act (“FTC Act”), which was addressed by a 2012 Federal Deposit Insurance Corporation (“FDIC”) Consent Order and settlement of a consumer class action, both barring future misconduct.  Plaintiffs further allege that throughout the Class Period, Higher One did not comply with the 2012 FDIC Consent Order and continued its prior misconduct, including violating FTC Act §5.  Plaintiffs allege that Defendants made false and/or misleading statements and/or omissions between August 7, 2012 to August 6, 2014, inclusive regarding Higher One’s marketing and disclosure practices, compliance with the Federal Trade Commission Act, and compliance with a previously-issued consent order and settlement obligations, thereby exposing Higher One to large potential civil penalties and restitution obligations.  The SAC further alleges that partial disclosures and events revealed Defendants’ fraud, thereby injuring Plaintiffs and the Settlement Class of investors. Plaintiffs allege that partial revelations of Defendants’ fraud caused huge stock declines, causing investors to suffer tremendous injury.  The Settling Defendants deny all of these allegations.

  • Classes are generally used in lawsuits that affect a large number of individuals. A class action consolidates into a single action all of the claims of individuals allegedly harmed by the same conduct or course of conduct in the same period of time, thus removing the need for members of the class to file their own individual lawsuits to separately seek to recover for the harm alleged. Once the class is certified, the Court is empowered to resolve all issues on behalf of members of the class, except for those, if any, who specifically choose to exclude themselves from the class.

    As part of the preliminary approval process, Plaintiffs will ask the Court to certify a class for settlement purposes only.  The proposed Settlement Class will consist of all persons or entities who purchased Higher One securities between August 7, 2012 through August 6, 2014, both dates inclusive. Excluded from the Settlement Class are Settling Defendants, Defendant Wolf, and former Defendant McFadden, members of their immediate families, any officer or director of Higher One during the Settlement Class Period, and any entity in which any Settling Defendant, Defendant Wolf, or former Defendant McFadden have a controlling interest, and the successors, heirs, and assigns of any excluded persons and entities referenced above. Per terms of the Stipulation, the Settling Defendants shall assist in identifying the persons and entities to be excluded from the Settlement Class.

  • This Action has not gone to trial, and the Court has not decided in favor of either side. Instead, legal counsel for all the parties, along with Defendants’ insurance carriers, participated in an all-day mediation before an experienced JAMS mediator and, after further negotiations thereafter, the Settling Parties agreed to the Settlement to avoid the costs and risks of further litigation.

    Plaintiffs and Lead Counsel believe that the Settlement is in the Settlement Class Members’ best interest and provides them with a substantial benefit now, instead of engaging in years of further uncertain and expensive litigation - including Defendants’ motion for reconsideration (pending as of the date the parties agreed to settle) of the Court’s order denying their latest motion to dismiss; Plaintiffs’ class certification motion, which Defendants would oppose; the parties’ cross- motions for summary judgment; pre-trial motions and a lengthy trial; likely appeals; and attempts to enforce any judgment – all with the possibility of no recovery at all.  By settling the Action with the Settling Defendants at this point, Plaintiffs are not admitting that the Action lacked merit, or that the Settlement Class’s ultimate recovery would not have been greater than the Settlement Amount had litigation continued.  Neither the Stipulation, nor any of its terms or provisions, nor any of the negotiations or proceedings connected with it, shall be construed as an admission or concession by the Plaintiffs or the Settlement Class Members that any of their claims lack merit; that any defenses asserted by any of the Defendants in the Action have any merit; or that damages recoverable in the Action would not have exceeded the Settlement Fund.

    The Settling Defendants have denied and continue to deny all of the allegations made and claims brought by Plaintiffs, maintain that they have meritorious defenses, and believe they would prevail at trial. Nonetheless, the Settling Defendants have concluded that further litigation of this Action would be protracted and expensive, taking into account the uncertainty and risks inherent in any litigation, especially in complex cases like this Action. The Settling Defendants have, therefore, determined that it is desirable and beneficial that the Action be fully and finally settled under the terms and conditions of this Settlement. The Settlement shall in no event be construed as, or deemed to be evidence of, an admission or concession by Settling Defendants with respect to any claim of any fault or liability or wrongdoing or damage to the Plaintiffs or the Settlement Class Members in this Action.

    The Settlement must be compared to the risk of no recovery after contested dispositive motions, trial, and likely appeals. A trial is a risky proposition. The claims in the Action involve numerous complex legal and factual issues, many of which would require expert testimony. The Settling Parties disagree on both liability and damages, and do not agree on the average amount of damages per share, if any, that would be recoverable if Plaintiffs were to have prevailed on each claim alleged against the Settling Defendants. Among their many other disagreements are: (1) whether the Settling Defendants violated the securities laws or otherwise engaged in wrongdoing; (2) whether the misrepresentations and omissions alleged by the Plaintiffs were material, false, misleading or otherwise actionable; (3) the extent (if any) that the alleged misrepresentations and omissions influenced Higher One’s stock price during the Settlement Class Period; and (4) the method for determining whether, and the extent to which, purchasers of Higher One stock suffered injury and damages that could be recovered at trial.

  • To see if you will get money from this Settlement, you first have to decide if you are a Settlement Class Member.

  • The Settlement Class includes all persons or entities who purchased Higher One securities between August 7, 2012 through August 6, 2014, both dates inclusive.

  • Yes. You are not a member of the Settlement Class if you did not purchase Higher One stock on or between the dates listed above. If you purchased Higher One stock some other time, or did not purchase it at all, you are not included within the Settlement Class.

    You are also not a member of the Settlement Class if you are on the list of persons and entities that are specifically excluded from it,(per Notice page 4)

  • If you are still not sure whether you are included, you can ask for free help. You can contact the Claims Administrator toll-free at 1- 888-305-6486 or at P.O. Box 91346, Seattle, WA  98111, for more information. Or you can fill out and return the Proof of Claim Form enclosed with the Notice package, to see if you qualify.

  • In exchange for the Settlement and the release of the Settled Claims (defined in the Notice) as well as dismissal of the Action, Settling Defendants have agreed that a payment of seven million five hundred thousand dollars ($7,500,000.00) will be made on Settling Defendants’ behalf to be divided, after payment of Court-approved attorneys’ fees and expenses, the costs of claims administration including the costs of printing and mailing the Notice and the cost of publishing notice, any compensatory award granted to Plaintiffs, and Taxes (the “Net Settlement Fund”), pro rata among all Settlement Class Members who send in a valid Proof of Claim Form.

  • Your share of the Net Settlement Fund will depend on several factors, including the following: how many Settlement Class Members submit timely and valid Proof of Claim Forms; the total Recognized Losses represented by the valid Proof of Claim and Release Forms that the Settlement Class Members send in; your Recognized Losses, based on the number of Higher One securities you purchased during the Settlement Class Period, how much you paid for them, when you purchased them, and if you sold them, when and for how much you sold them.

    By following the instructions in the Plan of Allocation, you can calculate what is called your Recognized Loss.  It is unlikely that you will get a payment for all of your Recognized Loss. After all Settlement Class Members have sent in their Proof of Claim and Release Forms, the payment you get will be a part of the Net Settlement Fund equal to your Recognized Loss divided by the total of everyone’s Recognized Losses. See the Plan of Allocation for more information.

  • To qualify for a payment, you must have submitted a Proof of Claim and Release Form, which is enclosed with the Notice and may also be downloaded at www.higheronesecuritieslitigation.com. Read the instructions carefully, fill out the Form completely, include all the documents that the Form asks for, sign it, and mail or submit it online so that it is postmarked no later than May 26, 2018.

  • The Court held a Settlement Hearing on July 10, 2018 and approved the Settlement, there might be appeals afterwards. It is always uncertain whether these appeals can be resolved, and resolving them can take time, perhaps more than a year. It also takes time for all the Proof of Claim and Release Forms to be processed. Please be patient.

  • Unless you timely excluded yourself, you will remain a Settlement Class Member and will be bound by the Release of claims against the Settling Defendants and the Released Parties. That means you cannot sue, continue to sue, or be part of any other lawsuit against the Settling Defendants or the Released Parties about the Settlement Class Claims in this Action. It also means that all of the Court’s orders will apply to you and legally bind you, and you will release your claims in this Action against the Settling Defendants and the Released Parties. The terms of the Release are included in the Proof of Claim and Release Form that is enclosed.

  • If you do not want a payment from this Settlement, and you want to keep the right to sue the Settling Defendants and the other Released Parties on your own about the legal issues that were at issue and litigated in this Action, then you must take steps to remove yourself from the Settlement. This is called excluding yourself—sometimes referred to as “opting out” of the Settlement Class.  If you decide to exclude yourself from the Settlement Class, and wish to file your own individual lawsuit, Defendants may argue that you may face a time bar under applicable statutes of limitation or repose, risks that you should discuss with an appropriate legal advisor.

  • To exclude yourself from the Settlement Class, you must have sent a letter by First-Class Mail (e-mail or phone call will not suffice) stating that you “request exclusion from the Settlement Class in Perez v. Higher One Holdings, Inc., Case No. 3:14-cv-755-AWT.” Your letter must include the date(s), price(s), and number(s) of all purchases and sales of Higher One securities during the Settlement Class Period. In addition, you must include your name, address, telephone number, and your signature. You must have mailed your exclusion and needed to be postmarked no later than June 19, 2018 to: 

    Perez v. Higher One Holdings, Inc.
    c/o JND Legal Administration
    P.O. Box 91346
    Seattle, WA 98111

    If you ask to be excluded, you will not get any payment, and you cannot object to the Settlement. You will not be legally bound by anything that happens in the Action.

  • No. Unless you have excluded yourself from the Settlement Class, you give up any rights to sue the Settling Defendants and the other Released Parties for the Settlement Class Claims. If you have a pending lawsuit against the Settling Defendants or other Released Parties, speak to your lawyer in that case immediately. You must have excluded yourself from this Action to continue your own lawsuit. Remember, the exclusion deadline was June 19, 2018.

  • No. If you exclude yourself, you may not send in a Proof of Claim and Release Form to ask for any money.

  • The Court ordered that the law firm of Pomerantz LLP shall represent the Settlement Class Members, including you. These lawyers are called Lead Counsel. You will not be personally liable for the fees and expenses incurred by these lawyers, which will be paid from the Settlement Fund. If you want to be represented by your own lawyer, you may hire one at your own expense.

  • Lead Counsel has litigated this Action since May 2014 on a wholly contingent basis, meaning that they have not been paid any attorneys’ fees for the time devoted to the lawsuit, nor have they been reimbursed their out-of-pocket expenses incurred during that time period.  As such, as part of the Settlement approval process, Lead Counsel will move the Court for an award of attorneys’ fees in an amount not greater than thirty percent (30%) of the Settlement Fund and for out-of-pocket expenses and costs in an amount not to exceed seventy-five thousand dollars ($75,000.00) in connection with the litigation, plus interest on such fees, costs, and expenses at the same rate earned by the Settlement Fund. The Court will decide whether to grant this request, and, if it is granted, how much to award Lead Counsel.  Such sums as may be approved by the Court will be paid from the Settlement Fund. 

    Lead Counsel shall file a formal motion with the Court for approval of the Settlement, the Plan of Allocation, the request for attorneys’ fees and reimbursement of expenses, and the request for compensatory awards to both of the Plaintiffs of up to three thousand dollars ($3,000.00) total, or one thousand five hundred dollars ($1,500.00) apiece, no later than June 12, 2018

    Lead Counsel believes that the requested attorneys’ fees are warranted in light of its efforts, and those of other counsel in support, on a wholly contingent basis, to investigate the underlying claims, work with a private investigator and a damages analyst, file initial and multiple amended complaints, litigate multiple motions to dismiss, negotiate and paper a case management and discovery plan, serve initial disclosures in discovery, mediate the dispute before an experienced mediator, and thereafter negotiate the Settlement and work to paper it and submit it to the Court for necessary approvals. Lead Counsel’s motion will argue that the requested fees are well within the range of fees awarded to class counsel under similar circumstances in other cases of this type and are reasonable when compared against Lead Counsel’s actual time devoted to the litigation of the Action at the applicable billing rates of Lead Counsel’s attorneys and paralegals. The Court determines what to award Lead Counsel as fees and expenses from the Settlement Fund, and may award more or less than the amount requested, in its discretion. 

  • If you are a Settlement Class Member, you can object to the proposed Settlement, the proposed Plan of Allocation, and/or Lead Counsel’s fee, cost, and expense application. You can write to the Court setting out your objection. The Court will consider your views. To object, you must send a signed letter saying that you object to the proposed Settlement in the Perez v. Higher One Holdings, Inc. Case No. 3:14-cv-755-AWT. Be sure to include your name, address, telephone number, and your signature, identify the date(s), price(s), and number(s) of Higher One securities that you purchased, otherwise acquired, sold, or otherwise disposed of during the Settlement Class Period, and state the reasons why you object to the proposed Settlement. If you object to either the Settlement, requested attorneys’ fees, or Plaintiffs’ compensatory award, you subject yourself to the jurisdiction of the Court in this matter, and Plaintiffs, acting through Lead Counsel, will have the right to take your deposition prior to the Settlement Fairness Hearing. If you refuse to have your deposition testimony taken upon Plaintiffs’ request, your objection will be deemed invalid. Your objection must be filed with the Court and mailed or delivered to each of the following addresses such that it is received no later than June 19, 2018:

     

    COURT
     

    Office of the Clerk
    United States District Court
    Abraham Ribicoff Federal Building
    450 Main Street
    Hartford, Connecticut 06103
     

    LEAD COUNSEL
     

    Matthew L. Tuccillo
    POMERANTZ LLP
    600 Third Avenue
    20th Floor
    New York, NY 10016
     

    SETTLING DEFENDANTS’ COUNSEL
     

    Joni Jacobson
    DECHERT LLP
    35 West Wacker, Suite 3400
    Chicago, IL 60601

    Counsel for Defendant Higher One Holdings, Inc.

     

    Joseph C. Merschman
    WIGGIN AND DANA LLP
    One Century Tower
    265 Church Street
    P.O. Box 1832
    New Haven, CT 06508-1832

    Counsel for Defendants Mark Volchek, Miles Lasater, Jeffrey Wallace, and Dean Hatton
     

  • Objecting is simply telling the Court that you do not like something about the proposed Settlement. You can object only if you stay in the Settlement Class. Excluding yourself is telling the Court that you do not want to be part of the Settlement Class and do not want to seek a payment from the Settlement Fund. If you exclude yourself, you have no basis to object because the case no longer affects you.

  • The Court will hold a hearing to decide whether to approve the proposed Settlement. You may attend, and you may ask to speak, but you do not have to do so.

  • The Court will held a Settlement Hearing on July 10, 2018, at 10:00 a.m., at the Abraham Ribicoff Federal Building, 450 Main Street, South Courtroom, Hartford, Connecticut 06103, for the following: to determine whether the proposed Settlement of the Action on the terms and conditions provided for in the Stipulation is fair, reasonable, and adequate to the Settlement Class Members and have been approved by the Court; to determine whether an Order and Final Judgment as provided in the Stipulation should be entered; to determine whether the proposed Plan of Allocation should be approved; to determine any amount of fees, costs, and expenses that should be awarded to Lead Counsel and any compensatory awards to Plaintiffs for their service to the Settlement Class; and to consider such other matters as the Court may deem appropriate. If there are objections, the Court will consider them. The Court will listen to people who have asked to speak at the hearing.

    At or after the Settlement Hearing, the Court approved the Settlement and whether, and if so how much, to make awards to Lead Counsel and to the Plaintiffs.  

     

  • No. Lead Counsel will answer questions the Court may have and has extensive experience handling settlement-related hearings of this nature. But you are welcome to come at your own expense. If you send an objection, you do not have to come to Court to talk about it. As long as you mailed your written objection on time, the Court will consider it. You may also pay your own lawyer to attend, but it is not necessary. Settlement Class Members do not need to appear at the hearing or take any other action to indicate their approval

  • If you object to the Settlement, you may ask the Court for permission to speak at the Settlement Hearing. To do so, you must include with your objection (see page 9 of the Notice) a statement saying that it is your “intention to appear in Perez v. Higher One Holdings, Inc. Case No. 3:14-cv-755-AWT.” Persons who intend to object to the Settlement, the Plan of Allocation, and/or the application for an award of attorneys’ fees, costs, and expenses and desire to present evidence at the Settlement Hearing must include in their written objections the identity of any witnesses they may call to testify and exhibits they intend to introduce into evidence at the Settlement Hearing. You cannot speak at the hearing if you exclude yourself.

  • If you do nothing, all of your claims against the Settling Defendants and the Released Parties will be released, but you will not receive any money from the Settlement, because it is necessary to submit a Proof of Claim and Release Form to share in the Settlement proceeds.

  • The Notice summarizes the proposed Settlement. More details are in a Stipulation of Settlement dated February 6, 2018 (the “Stipulation”). The Stipulation is the controlling document describing the proposed Settlement and its terms govern anything to the contrary in the Notice. You can get a copy of the Stipulation and obtain answers to common questions regarding the proposed Settlement by contacting the Claims Administrator toll-free at 1-888-305-6486 or by downloading it from the Claims Administrator’s website at www.higheronesecuritieslitigation.com. 

  • For even more detailed information concerning the matters involved in this Action, reference is made to the Stipulation, to the pleadings in support of the Settlement, to the Orders entered by the Court, and to the other papers filed in the Action, which will be posted on the settlement website at www.higheronesecuritieslitigation.com.

For More Information

Visit this website often to get the most up-to-date information.

Mail

Perez v. Higher One Holdings, Inc. 
c/o JND Legal Administration
P.O. Box 91346
Seattle, WA 98111