On January 6, 2012, the Delaware Court of Chancery issued an opinion dismissing with prejudice one of the representative plaintiffs in a class action for trading stock while in possession of non-public information that the defendants had produced in discovery. The court held that such trading is unacceptable and constitutes a breach of the fiduciary obligations that representative plaintiffs have to the class. Wilson Sonsini Goodrich & Rosati is representing the defendants in this litigation.

Background

Occam Networks, Inc., was a publicly traded Delaware corporation that announced on September 16, 2010, that it had entered into a merger agreement with Calix, Inc., another publicly traded company in the telecommunications equipment industry. The agreement provided that each share of Occam stock would be converted into the right to receive $3.83 in cash and 0.2925 shares of Calix stock.

On October 1, 2010, several Occam shareholders, including Michael Steinhardt and two funds under his control, filed a class action complaint challenging the merger in the Delaware Court of Chancery. At that time, Mr. Steinhardt, a legendary hedge fund manager who has been described as "one of the most successful investors in the history of Wall Street," and his funds owned more than 2.8 million shares of Occam, which represented 13.5 percent of Occam's outstanding stock.