Discovery halts in consolidated securities suit against Northwest Pipe

Posted on: June 13th, 2012 by Steve Larson
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The parties in a consolidated securities class action lawsuit against Northwest Pipe have agreed that no further discovery will take place until after they exhausted the mediation process, which started on January 2012, according to Northwest Pipe Company’s April 27, 2012, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2011.

On November 20, 2009, a complaint against the company, captioned Richard v. Northwest Pipe Co. et al., No. C09-5724 RBL (“Richard”), was filed in the United States District Court for the Western District of Washington.  The plaintiff is allegedly a purchaser of the company’s stock.  In addition to the company, Brian W. Dunham, the company’s former President and Chief Executive Officer, and Stephanie J. Welty, the Company’s former Chief Financial Officer, are named as defendants.  The complaint alleges that defendants violated Section 10(b) of the Securities Exchange Act of 1934 by making false or misleading statements between April 23, 2008, and November 11, 2009.

A similar complaint, captioned Plumbers and Pipefitters Local Union No. 630 Pension-Annuity Trust Fund v. Northwest Pipe Co. et al., No. C09-5791 RBL (“Plumbers”), was filed against the company in the same court on December 22, 2009.  The Richard action and the Plumbers action were consolidated on February 25, 2010.  Plumbers and Pipefitters Local No. 630 Pension-Annuity Trust Fund was appointed lead plaintiff in the consolidated action.

A consolidated amended complaint was filed by the plaintiff on December 21, 2010, and the company’s motion to dismiss was filed on February 25, 2011, as were similar motions filed by the individual defendants.  Briefing on those motions concluded on May 24, 2011.  On August 26, 2011, the court denied all defendants’ motions to dismiss, and the company filed its Answer to the consolidated amended complaint on October 24, 2011.

The parties have conducted limited discovery and participated in an initial settlement mediation on January 30, 2012, with additional sessions anticipated in the future.  By agreement of the parties, no further discovery will take place until after the mediation process is exhausted.