NEW YORK, Sept. 9, 2016 /PRNewswire/ -- This notice relates
to a proposed voluntary dismissal of a shareholder derivative
action and is being given pursuant to an order of The United States
District Court for the Southern District of California. The
purpose of the notice is to advise shareholders of Bridgepoint
Education, Inc. (NYSE: BPI) ("Bridgepoint" or the "Company") that
the plaintiff James Cannon
("Plaintiff") in the action James
Cannon v. Andrew S. Clark, et
al., Case No. 13-CV-2645 JM (NLS) (S.D.
Cal.) (the "Action") wishes to voluntarily dismiss the
case. Additional information on the action and right to
intervene can be found below.
THE SHAREHOLDER DERIVATIVE ACTION
On November 1, 2013, after making
a books and records demand pursuant to 8 Del. C. §220 (the
"Inspection Demand") and receiving documents pursuant thereto,
Plaintiff filed a shareholder derivative action against defendants
Andrew S. Clark, Daniel J. Devine, Jane
McAuliffe, Rodney T. Sheng,
Patrick Hackett, Ryan Craig, Robert
Hartman, Adarsh Sarma,
Dale Crandall, Dr. Marye Anne Fox, and Andrew M. Miller (collectively, the "Individual
Defendants") on behalf of nominal defendant Bridgepoint. On
November 18, 2013, and in light of
Plaintiff's use of confidential information derived from the
Inspection Demand, the Court granted Plaintiff's Motion to File
Verified Shareholder Derivative Complaint Under Seal and ordered
Plaintiff to file a complaint in the public record redacting any
information covered by the parties' Confidentiality
Agreement. Thereafter, the Action was stayed by joint motion
and order of the Court dated January 6,
2014, pending the completion of discovery in a related
federal securities action entitled In re Bridgepoint Education,
Inc. Securities Litigation, 3:12-cv-01737 JM (WMC)
(S.D. Cal.). No responsive
pleadings have been filed in the Action by Defendants. A
related shareholder derivative action was also filed in the
Superior Court of the State of
California, San Diego
County, entitled In re Bridgepoint Education Inc.
Shareholder Derivative Litigation, Lead Case No.:
37-2012-00101167-CU-BT-CTL, remains pending and will not be
effected by the proposed dismissal of the
Action.
The Action arises from alleged breaches of fiduciary duties by
the Individual Defendants in connection with the alleged issuance
of materially false and misleading statements about Bridgepoint's
accreditation prospects at Ashford
University, and Bridgepoint's operations, management, and
internal controls. Based on these allegations, the Action
asserts claims for (1) breach of fiduciary duty; (2) abuse of
control; (3) gross mismanagement; (4) waste of corporate assets;
(5) breach of the fiduciary duties of loyalty and good faith in
connection with insider stock sales; and (6) unjust
enrichment. The Action seeks monetary damages, injunctive
relief, and attorneys' fees and costs.
On June 12, 2015, Plaintiff's
counsel notified the District Court that Plaintiff had sold all of
his Bridgepoint stock and that he no longer had the requisite legal
standing to pursue the Action on behalf of the Company because he
was no longer a Bridgepoint shareholder. On June 16, 2015, the District Court denied
Plaintiff's request to dismiss the action without prejudice and
without notice to stockholders and held that Plaintiff could file
another request. On July 7,
2015, Plaintiff filed a further request for dismissal.
On August 3, 2015, the District Court
denied plaintiff's motion to voluntarily dismiss without notice and
ordered the parties to submit a joint notice plan contemplating the
issuance of notice of the proposed voluntary dismissal of the
Action to Bridgepoint shareholders and a procedure by which other
Bridgepoint shareholders could intervene in the Action. If no
other Bridgepoint shareholder seeks to intervene in the Action,
Plaintiff shall file a motion with the District Court requesting
dismissal of the Action.
THE RIGHT TO INTERVENE IN THE ACTION
Any Bridgepoint shareholder may seek to intervene as a plaintiff
in the Action if he, she, or it (1) currently owns shares in
Bridgepoint and has continuously held those shares since
May 3, 2011; and (2) wishes to pursue
the claims in the Action or has any reason why the action should
not be voluntarily dismissed. All motions to intervene must
be filed with the Clerk of the Court no later than October 24, 2016. Every motion to intervene
must contain: (1) the caption of the Action which is
James Cannon v. Andrew S. Clark, et al., Case No. 13-CV-2645
JM (NLS) (S.D. Cal.); (2) the
intervenor's name, address and phone number; (3) proof or
certification of the date the intervenor purchased Bridgepoint
stock and has continuously held the stock to the present; and (4)
any supporting papers, including all documents and writings that
the intervenor desires the Court to consider.
Any motions to intervene must be filed with the District
Court at:
Clerk of Court
United States District Court for the Southern District of
California
Edward J. Schwartz U.S. Courthouse
221 West Broadway
San Diego, CA 92101
A copy of any motion to intervene must also be mailed
to:
Ignacio E. Salceda
Wilson Sonsini Goodrich &
Rosati
Professional Corporation
650 Page Mill Road
Palo Alto, CA 94304-1050
Attorneys for Defendants Andrew S.
Clark, Daniel J. Devine,
Jane McAuliffe, Rodney T. Sheng, Patrick
Hackett, Ryan Craig,
Robert Hartman, Adarsh Sarma, Dale
Crandall, Dr. Marye Anne Fox,
and Andrew M. Miller and Nominal
Defendant Bridgepoint Education, Inc.
Beth A. Keller
Hynes Keller & Hernandez, LLC
118 N. Bedford Road, Ste. 100
Mt. Kisco, NY 10549
bkeller@hkh-lawfirm.com
Attorneys for Plaintiff James Cannon
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SOURCE Hynes Keller & Hernandez, LLC