## Facts

- Multiple federal securities class actions were filed by purchasers of Oxford Health Plans, Inc. securities alleging nondisclosure of serious computer and information-system problems, related financial harm, and insider trading by executives.
- The actions were consolidated for coordinated pretrial proceedings in the Southern District of New York under 28 U.S.C. § 1407 as MDL-1222 (initially 52 actions, with additional related filings later).
- Competing motions were made under the Private Securities Litigation Reform Act of 1995 (PSLRA) to appoint a lead plaintiff (or lead-plaintiff group) and to approve lead counsel.
- The principal movants for leadership were: Public Employees’ Retirement Association of Colorado (ColPERA), the Vogel Group (individual investors), and the PBHG Funds (institutional investment funds).
- Each movant asserted substantial losses from trading in Oxford securities during the proposed class period and sought to direct the litigation and select counsel.

## Issues

1. Under the PSLRA, which movant or movants should be appointed lead plaintiff(s) as the “most adequate plaintiff,” considering financial interest and Rule 23 typicality and adequacy?
2. Whether the proposed governance structure—multiple co-lead plaintiffs and multiple co-lead counsel—should be approved, and on what conditions.

## Decision

- The court appointed ColPERA, the Vogel Group, and PBHG as co-lead plaintiffs.
- The court approved the co-lead plaintiffs’ selection of three co-lead counsel: Grant & Eisenhofer, P.A. (for ColPERA), Milberg Weiss Bershad Hynes & Lerach, L.L.P. (for PBHG), and Chitwood & Harley (for the Vogel Group).
- The court ordered the co-lead counsel to coordinate through an executive-committee structure to manage responsibilities and reduce duplication in the MDL.

## Legal Principles

- Under 15 U.S.C. § 78u-4(a)(3)(B), the court must appoint as lead plaintiff the class member(s) most capable of representing the class; a rebuttable presumption favors the movant (or group) with the largest financial interest that otherwise satisfies Rule 23 requirements.
- At the lead-plaintiff stage, Rule 23 analysis centers on typicality and adequacy, not full class-certification findings.
- A “group of persons” may serve as lead plaintiff under the PSLRA when the group is capable of functioning collectively and its members’ claims and incentives align with the class.
- Courts generally defer to the lead plaintiffs’ selection of counsel, subject to approval and case-management measures to prevent inefficiency, conflicts, and unnecessary duplication, especially in large consolidated proceedings.

## Conclusion

In this consolidated securities-fraud MDL, the court applied the PSLRA’s rebuttable presumption and Rule 23 adequacy/typicality to appoint three large, sophisticated investors as co-lead plaintiffs and approved their chosen co-lead counsel, imposing a coordinated leadership structure to manage the litigation efficiently.


In re Oxford Health Plans, Inc. Securities Litigation, 182 F.R.D. 42 (S.D.N.Y. 1998)