Brian E. Rosenzweig

Michigan's highest court has agreed to review a lower court's ruling that a city violated state open meetings law when it held closed-door meetings to evaluate the applicants for a limited pool of marijuana business licenses. On Wednesday, the state Supreme Court issued an order for oral arguments in Royal Oak, Michigan's appeal of an intermediate appellate decision that threatened to undo marijuana business licenses the city awarded to two companies in 2022. Royal Oak was sued by Exclusive Capital Partners and Quality Roots Inc., which were both applicants for the city's only two marijuana retail licenses and challenged the city's decision to pass them over on a number of grounds. In December, a Michigan Court of Appeals panel said all the applicants' claims failed except one: Royal Oak had violated Michigan's Open Meetings Act in the process of selecting the applicants that would be awarded licenses, according to the panel. Royal Oak received 31 applicants for the two retail licenses it was planning to dole out in 2022. The city manager, who was tasked with administering the retail license program, formed a "workgroup" to assess the applicants, which met four times in closed-door sessions, according to the opinion. The city manager ranked the top two applicants to recommend to the Royal Oak City Commission, and the commission ultimately voted to approve the licenses, according to the court records. The Court of Appeals panel said that although the Royal Oak City Commission technically held the power to award the licenses, the commissioners had effectively rubber-stamped the city manager's licensing decisions. "Because the city manager made a de facto policy choice for the City Commission, the city manager met the definition of 'governing body,' and, thus, was subject to the [Open Meetings Act]," the panel said. "It follows that the meetings that the city manager had with his workgroup should have been noticed and made open to the public." The violations could result in the licenses being invalidated, the panel said, though it noted invalidation is not the only remedial option for open meetings violations. The city manager could also be ordered to redo the licensing process in compliance with the open meetings law. In Wednesday's order, the high court asked for briefs addressing "whether the city of Royal Oak's city manager was a 'public body'" subject to the Open Meetings Act. Exclusive Capital and Quality Roots had lodged other objections to the city's licensing program, including that the marijuana ordinance was vague and inconsistent with state marijuana law, which requires a competitive process, and that their due process rights were violated. The appellate court rejected the companies' other challenges to Royal Oak's marijuana ordinance and the city's process. Lawyers for the parties did not immediately respond to requests for comment. Exclusive Capital and Quality Roots are represented by Brian E. Etzel and William C. DiSessa of Williams Williams Rattner & Plunkett PC. The city is represented by Anne McClorey McLaughlin of Rosati Schultz Joppich & Amtsbuechler PC. The cases are Exclusive Capital Partners v. Royal Oak and Quality Roots Inc. v. Royal Oak, case numbers 168243 and 168244, in the Michigan Supreme Court.

Oct 30

2 min

Oncology-focused biopharmaceutical company Eikon Therapeutics began trading publicly Thursday after raising $381 million in its upsized initial public offering. The company sold 21.2 million shares for $18 apiece and began trading on the Nasdaq under ticker symbol EIKN. Covington & Burling LLP advised the company, while Davis Polk & Wardwell LLP advised its underwriters. Eikon last week told regulators that it planned to raise $300 million in its offering by selling 17.6 million shares for a range between $16 and $18. Eikon is a late-stage clinical biopharmaceutical company that is advancing a pipeline of oncology drug candidates targeting areas of high unmet need that could eventually become critical medicines, according to a filing with the U.S. Securities and Exchange Commission. The company also deploys its technology platform to develop internally derived novel therapies. "Our vision is to become a generational leader, by purposefully integrating traditional biology research with advanced engineering to develop better medicines faster," the company said in the SEC filing. "We believe our product candidates reflect strong scientific and clinical potential and could eventually become critical medicines in the treatment paradigm of various cancers." Eikon is backed by leading venture capital firms such as Lux, Foresite Capital, and the Column Group, according to the SEC filing. The company has granted its underwriters a 30-day option to purchase up to an additional roughly 3.2 million shares of common stock at the IPO price, and the offering is expected to close Friday. Eikon's public debut follows another biotech that went public this week. Hair loss drug developer Veradermics Inc. began trading publicly Wednesday after raising $256 million in its upsized offering. The company, which began trading on the New York Stock Exchange, offered 15.1 million shares for $17 apiece, above the marketed range of $14 to $16. The company had previously announced that it would offer nearly 13.4 million shares. The Covington team advising Eikon included Brian Rosenzweig, Bradley Chernin, and Brianna Bloodgood. The Davis Polk team advising the underwriters included Alan Denenberg and Emily Roberts.

Feb 5

2 min

Amusement park giant Six Flags Entertainment Corp. faces a proposed investor class action alleging the company failed to effectively capitalize on its 2024 merger with another theme park operator, precipitating a "catastrophic" earnings miss in August. In a complaint filed Wednesday in Ohio federal court, the City of Livonia Employees' Retirement System, an institutional investor in Six Flags, said the company's 2024 merger with Ohio-headquartered Cedar Fair LP has been followed by "disastrous financial and operational results," hurting investors as the markets reacted to its financial woes. These issues came to a head in August when the company revealed a steep earnings miss, a debt-to-earnings leverage ratio that had "ballooned" and spoke about divesting certain assets and reassessing its long-term guidance, the complaint said. Following this report, Six Flags' share price fell as low as $20, down roughly 64% from $55 trading prices it saw on the heels of its 2024 merger, the investor said. The 2024 merger saw the two amusement park companies form the largest regional amusement park operator in North America, with a property portfolio of approximately 40 amusement parks and water parks and several resorts, the complaint states. But undisclosed in the lead-up to the merger were steep problems for Six Flags, the pension fund said, including that it "suffered from chronic underinvestment and its parks required millions of dollars in additional capital and operational expenditures above the company's historical cost trends in order to maintain (let alone grow) legacy Six Flags' share in the intensely competitive amusement park market." Among other things, Six Flags' parks had been skipping basic maintenance, operational improvements, infrastructure repairs and ride updates for years, and a workforce reduction in 2021 had "had degraded the company's operational competence and guest experience," the suit said. The investor alleged that turning its parks around would require the company to make "a massive, undisclosed capital infusion" in its properties that made the company's stated goals for its merger with Cedar Fair "not remotely achievable." Its suit also names current and former Six Flags executives and directors as defendants. Six Flags has seen pressure from shareholder activist Land & Buildings to spin off its real estate, and in October, Kansas City Chiefs tight end Travis Kelce was part of a group that went in on a 9% stake in the company. Representatives for the parties did not immediately respond to requests for comment. The City of Livonia Employees' Retirement System is represented by Samuel H. Rudman, Brian E. Cochran and Robert J. Robbins of Robbins Geller Rudman & Dowd LLP, Thomas C. Michaud of VanOverbeke Michaud & Timmony PC and Joseph F. Murray of Murray Murphy Moul + Basil LLP. Counsel information for the defendants wasn't immediately available Thursday. The case is City of Livonia Employees' Retirement System v. Six Flags Entertainment Corp. et al., case number 3:25-cv-02394, in the U.S. District Court for the Northern District of Ohio.

Nov 6

2 min

A Minnesota federal judge on Tuesday refused to recuse himself from consolidated private price-fixing litigation against a raft of pork producers, saying the defense's claims of bias due to one of his clerks' internships for plaintiff firms are a "fabricated" claim of impropriety. U.S. District Judge John R. Tunheim's order lambasted the dual motion for recusal and vacatur of key rulings against Agri Stats, Clemens, Seaboard, Smithfield, Triumph and Tyson, finding no appearance of bias from himself or his unnamed clerk to warrant the motion. While the clerk worked summer internships for the plaintiff firms pursuing this and similar "protein" price-fixing litigation, Judge Tunheim said the clerk did not work on the current case and had been screened from further work on the pork case during his clerkship. Judge Tunheim also noted the clerk was "one of more than a half-dozen law clerks who have worked on this matter over the course of more than seven years and dozens of motions." "This complex multi-district litigation is now ready for its first trial. At no other point have defendants questioned the court's ability to properly perform its duties in an impartial manner," the judge said. "Thus, while defendants' motion may have been timely to the extent it is based on defendants' knowledge of a specific law clerk's conduct, the court notes that defendants' waiting until after both the Daubert and summary judgement orders had been issued weighs in favor of finding the timing of defendants' motion to be more tactical than sincere." The case involves three separate classes of plaintiffs — consumer indirect buyers, institutional indirect buyers and direct buyers — alleging the defendants conspired to restrict supply and stabilize pork prices by sharing information through the Fort Wayne, Indiana-based data analytics and consulting firm Agri Stats, which is itself the subject of a separate U.S. Department of Justice case. Counsel for direct purchaser plaintiffs declined to comment. Counsel for the remaining parties did not immediately respond Tuesday to requests for comment. Judge Tunheim in late March mostly denied a slew of summary judgment motions from Agri Stats and the pork producers seeking wins against claims they conspired with the data firm to fix pork prices and reduce supply, in a case that's seen hundreds of millions of dollars' worth of settlements. He also rejected bids to exclude expert witnesses. The pork producers sought recusal a month later, citing the clerk's work as a summer associate at Lockridge Grindal Nauen PLLP and Robins Kaplan LLP. Lockridge Grindal represents purchasers in the pork case, and Robins Kaplan represents plaintiffs in some of the other cases targeting different protein producers in the array of cases that have swept in the chicken, turkey and beef industries. The producers also cited the clerk's work for the Minnesota Attorney General's Office, a pending job offer from Robins Kaplan and what they said were LinkedIn posts indicating his bias for the plaintiff firms. Judge Tunheim said Tuesday that the work for Robins Kaplan, a firm with no role in the current case, likely speaks only to the complexity of such a large litigation. He said the clerk "did not serve as a lawyer in — or do any work for — the specific matter in controversy," noting that the internship took place in the summer after the clerk's first year of law school and saw him performing research and analysis on subjects like corporate sales agreements, the introduction of summary exhibits and cellphone records discovery. "Such work would not have provided the law clerk with any personal knowledge of facts concerning this proceeding," the judge said. Judge Tunheim had particularly strong words for attacks on the clerk's LinkedIn posts, which the judge said amounted to using emojis and other acknowledgments of "his classmates' and colleagues' successes." That included celebrating an appointment to the American Antitrust Institute Advisory Board, in a post the defendants complained "announced that one of his former employers was suing Agri Stats and explicitly identified this case." Judge Tunheim didn't see it that way. "Arguably, it is defendants' collation of specific posts and defendants' characterization of those posts that fabricated an appearance of impropriety in this instance, not any actions of the law clerk," Judge Tunheim said. Nor did the fact the judge screened the clerk from further work on the pork case show that the court recognized an appearance of impropriety as the producers claim, according to the ruling. "The court screened the law clerk from future work on this matter to specifically shield the law clerk from further intrusive investigations and allegations of impropriety, which can be terrifying to a law clerk who is a new lawyer," Judge Tunheim said. "The court is, in fact, troubled by defendants' intrusive and unprofessional attacks on an outstanding law clerk who was highly professional throughout his one-year clerkship." Judge Tunheim additionally said there was no indication of bias for himself, asserting that when the clerk did work on the case, it was "in a very limited aspect of this case only because the judge's other law clerks were unavailable." That work, according to the ruling, was limited to work on the Daubert motions, and Judge Tunheim said his decisions there "were consistent with the court's holdings at the earlier class certification stage, when the law clerk in question did not yet work for the court." Nor is there any reason to vacate the contested rulings, Judge Tunheim said, noting the Daubert order's consistency with his prior decisions, "and, indeed, the court considered the experts presented by both parties to be of the highest quality." He also said vacatur would make it look like his clerk and not the judge "was making the decisions." He rejected the defense's assertions that preserving the decisions "will lead to future violations." "Rather, it seems much more likely that vacatur in this instance would incentivize counsel to dig through more law clerks' personal lives to attempt to find evidence that would create the insinuation of a conflict when a judge issues a ruling that counsel does not like," Judge Tunheim said. The direct purchaser plaintiffs are represented by Brian D. Clark, W. Joseph Bruckner and Arielle S. Wagner of Lockridge Grindal Nauen PLLP, and Bobby Pouya and Michael H. Pearson of Pearson Warshaw LLP. The consumer indirect purchaser plaintiffs are represented by Shana E. Scarlett, Rio S. Pierce, Steve W. Berman, Breanna Van Engelen, Elaine T. Byszewski and Abigail D. Pershing of Hagens Berman Sobol Shapiro LLP, and Daniel E. Gustafson, Daniel C. Hedlund, Michelle J. Looby and Joshua J. Rissman of Gustafson Gluek PLLC. The institutional indirect purchaser plaintiffs are represented by Shawn M. Raiter of Larson King LLP and Michael J. Flannery of Cuneo Gilbert & LaDuca LLP. Direct action plaintiff Sysco Corp. is represented by James J. McGuire of Greenspoon Marder LLP. Direct action plaintiffs The Kroger Co., Albertsons Cos. Inc., Hy-Vee Inc., Save Mart Supermarkets and US Foods Inc. are represented by Samuel J. Randall and William J. Blechman of Sperling Kenny Nachwalter. Direct action plaintiff Amory Investments LLC is represented by Derek T. Ho and Collin R. White of Kellogg Hansen Todd Figel & Frederick PLLC. Direct action plaintiffs McDonald's Corp., PJ Food Service Inc., Aramark Food and Support Services Group Inc., Target Corp., Gordon Food Service Inc., Glazier Foods Co., Quality Supply Chain Co-Op Inc., Sherwood Food Distributors LLC, Harvest Meat Co. Inc., Western Boxed Meat Distributors Inc., Hamilton Meat LLC, Jetro Holdings LLC, Maximum Quality Foods Inc., BJ's Wholesale Club Inc., Kraft Heinz Foods Co., Winn-Dixie Stores Inc. and Bi-Lo Holdings LLC are represented by Mark A. Singer of Cadwalader Wickersham & Taft LLP. Direct action plaintiffs Meat Distributors Inc., Topco Associates LLC, Alex Lee Inc./Merchants Distributors LLC, Associated Food Stores Inc., Brookshire Grocery Co., Colorado Boxed Beef Co., Certco Inc., The Golub Corp., Nicholas & Co., PFD Enterprises Inc., SpartanNash Co., Springfield Grocer Co., The Distribution Group d/b/a Van Eerden Foodservice Co., URM Stores Inc., Giant Eagle Inc. and UniPro Foodservice Inc. are represented by Brian C. Hill of Marcus & Shapira LLP. The commonwealth of Puerto Rico is represented by Jason H. Kim of Schneider Wallace Cottrell Konecky LLP. Hormel Foods Corp. and Hormel Foods LLC are represented by Aaron D. Van Oort, Craig S. Coleman, Emily E. Chow, Jacob D. Bylund, Robert C. Gallup, John S. Yi and Jonathan H. Todt of Faegre Drinker Biddle & Reath LLP. Tyson Foods Inc., Tyson Fresh Meats Inc. and Tyson Prepared Foods Inc. are represented by Tiffany Rider, Lindsey Strang Aberg and Jarod Taylor of Axinn Veltrop & Harkrider LLP, and Scott M. Rusert and A. Christopher Brown of Taft Stettinius & Hollister LLP. Clemens Food Group LLC and The Clemens Family Corp. are represented by Daniel E. Laytin, Christa C. Cottrell, Jenna M. Stupar, Amarto Bhattacharyya and Nicholas M. Ruge of Kirkland & Ellis LLP. Seaboard Foods LLC is represented by Peter J. Schwingler, Tess L. Erickson and Kelly C. Holt Rodriguez of Jones Day, and William L. Greene, William D. Thomson and J. Nicci Warr of Stinson LLP. Triumph Foods LLC is represented by Aaron Chapin, Christopher A. Smith, Tessa K. Jacob, A. James Spung, Jason Husgen, Sarah L. Zimmerman, Kate Ledden and Tanner M. Cook of Husch Blackwell LLP. JBS USA Food Co. is represented by Sami H. Rashid, Michael B. Carlinsky, David B. Adler and Heather Christenson of Quinn Emanuel Urquhart & Sullivan LLP, and Donald G. Heeman and Randi J. Winter of Spencer Fane LLP. Smithfield Foods Inc. is represented by John A. Cotter and John A. Kvinge of Larkin Hoffman Daly & Lindgren Ltd., Richard G. Parker of Milbank LLP, Joshua Lipton of Gibson Dunn & Crutcher LLP, and Brian E. Robison of Brown Fox PLLC. Agri Stats Inc. is represented by Peter H. Walsh, William L. Monts III and Justin W. Bernick of Hogan Lovells. The case is In re: Pork Antitrust Litigation, case number 0:18-cv-01776, in the U.S. District Court for the District of Minnesota.

Oct 7

8 min

A fund of Paramount Global Inc. investor Mario Gabelli notified Delaware's Court of Chancery on Thursday that no other stockholders have sought to lead a suit challenging Paramount Global's $8.4 billion acquisition by David Ellison's Skydance Media, with the fund seeking lead plaintiff status and Entwistle & Cappucci and Farnan LLP to be lead counsel. Gabelli's complaint, filed Aug. 19, names Skydance, Harbor Lights Entertainment — formerly National Amusements Inc. — Shari Redstone and others and seeks damages for "unfair and inequitable merger consideration" received by Paramount controller NAI and its affiliates compared with Class A shareholders. In a brief supporting the lead plaintiff appointment, Gabelli Value 25 Fund alleged that the Shari Redstone-led NAI parties facilitated the merger through a "corrupted sale process" that allowed them to garner a 165% premium for their shares compared with Class A stockholders. The NAI parties held 77.4% of Paramount's Class A shares going into the deal, the complaint said, and allegedly relied on both voting control and a purportedly conflicted Paramount board to steer the deal to Skydance without a "majority of the minority" unconflicted shareholder approval. "The NAI defendants' outrageous non-ratable premium agreed to by the Skydance defendants cost the Class A minority at least $270 million in improperly diverted merger consideration," Gabelli said in its brief. Neglected along the way, according to the complaint, was an obligation to secure terms that maximized value to Class A shareholders "or, at the very least, was equitable." NAI "crammed through" the deal, Gabelli alleged, using what the fund described as a rigged voting system favoring Skydance. As a result, the lead plaintiff brief said, the NAI parties named in the suit "forwent proposals that would have paid the Class A minority 21.7% to 24.2% more per share, in favor of the Skydance proposal that directed hundreds of millions more to the NAI defendants at the expense of the Class A minority." The case is assigned to Chancellor Kathaleen St. J. McCormick. Counsel for the parties did not immediately respond to requests for comment. Gabelli's complaint named five members of Paramount's board special committee as well as NAI, Shari Redstone, Skydance Media and RB Tentpole LP, or "Redbird," a Skydance investor that participated in merger negotiations. Redbird will nominate two of Paramount's 13 board members and own 10% of Paramount's nonvoting Class B stock. As part of the merger, Skydance paid NAI $1.75 billion in cash and assumed $650 million in NAI debt, with NAI receiving the equivalent of $60.95 for its Class A shares and $15 per share for its nonvoting Class B shares. Gabelli owned 52% of the Class A shares held by non-NAI-aligned shareholders and reported investigating the deal for a year beginning in early 2024, supported by a documents inspection, according to the complaint. Including affiliated funds and advisers publicly opposed to the deal, Gabelli said in its complaint that the dissident group's holdings would have determined the outcome if a majority of the minority vote had been required. In addition, Gabelli argued that the Class A-shareholding minority opponents were offered only nonvoting Class B shares in New Paramount if they chose to roll over their Class A shares into the new company. Gabelli Value 25 Fund Inc. is represented by Sue L. Robinson, Brian E. Farnan and Michael J. Farnan of Farnan LLP and Vincent R. Cappucci, Andrew J. Entwistle, Joshua K. Porter, Jessica A. Margulis and Andrew M. Sher of Entwistle & Cappucci LLP. Skydance Media LLC is represented by David E. Ross and S. Michael Sirkin of Ross Aronstam & Moritz LLP and Blair Connelly, Zachary L. Rowen, Alexander L. Mills, Yan Birzu Chu, Jack M. McNeily, Matthew L. Strand, J. Christian Word and Stephen T. Nasco of Latham & Watkins LLP. Barbara Byrne, Linda M. Griego, Judith McHale, Charles E. Phillips, Jr. and Susan Schuman are represented by Blake Rohrbacher, Daniel E. Kaprow, Christine J. Chen, Elizabeth J. Freud and Benjamin O. Allen of Richards Layton & Finger PA and Gary A. Bornstein, Michael P. Addis, Helam Gebremariam and Katherine DuBois of Cravath Swaine & Moore LLP. RB Tentpole LP is represented by Daniel B. Rath, Rebecca L. Butcher, Howard W. Robertson IV and Cheol W. Park of Landis Rath & Cobb LLP. The case is Gabelli Value 25 Fund Inc. v. Harbor Lights Entertainment Inc. (fka National Amusements Inc.) et al., case number 2025-0921, in the Court of Chancery of the state of Delaware.

Oct 16

3 min