{"id":348,"date":"2026-01-06T12:00:00","date_gmt":"2026-01-06T12:00:00","guid":{"rendered":"https:\/\/california.shuster.info\/?p=348"},"modified":"2026-01-06T12:00:00","modified_gmt":"2026-01-06T12:00:00","slug":"origin-materials-securities-litigation-ed-cal-preliminarily-approves-9-million-settlement","status":"publish","type":"post","link":"https:\/\/california.shuster.info\/?p=348","title":{"rendered":"In re Origin Materials Securities Litigation \u2014 E.D. Cal. Preliminarily Approves $9 Million Class Action Settlement"},"content":{"rendered":"
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Case<\/dt>\n
In re Origin Materials, Inc. Securities Litigation<\/dd>\n
Court<\/dt>\n
U.S. District Court \u2014 Eastern District of California<\/dd>\n
Date Decided<\/dt>\n
2026-01-06<\/dd>\n
Docket No.<\/dt>\n
2:23-cv-01816-WBS-JDP<\/dd>\n
Status<\/dt>\n
Unreported \/ Non-Citable<\/dd>\n
Topics<\/dt>\n
Securities Exchange Act, Section 10(b), Rule 10b-5, class action settlement, preliminary approval, Origin Materials<\/dd>\n<\/dl>\n<\/div>\n

Background<\/h2>\n

The defendant, Origin Materials, Inc., is a Delaware corporation headquartered in West Sacramento, California, that develops sustainable manufacturing materials. The case is one of four related securities actions arising from the same conduct: the company’s public communications about a major capital projects plan involving two commercial-style production facilities, called Origin 1 and Origin 2.<\/p>\n

The plaintiffs alleged that beginning in February 2023, the company and its officers made or allowed materially false and misleading statements \u2014 in regulatory filings and on earnings calls \u2014 about the construction progress and operational timeline of these facilities. According to the complaint, both projects were behind schedule, but the company continued to release positive updates about expected commercialization. After the alleged truth emerged in August 2023, the stock price dropped, generating losses for shareholders who had purchased Origin securities during the proposed class period (February 23, 2023 to August 9, 2023).<\/p>\n

The plaintiffs sued under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 10b-5. The court appointed Todd Frega as Lead Plaintiff and approved Bernstein Liebhard LLP as Lead Counsel. After litigation that dismissed one defendant (Richard Riley), the parties negotiated a $9 million settlement and Lead Plaintiff filed an unopposed motion for preliminary approval.<\/p>\n

The Court’s Holding<\/h2>\n

The court preliminarily approved the proposed $9 million class action settlement and authorized notice to be sent to the class. Because the parties reached the settlement before formal class certification, the court first analyzed whether to certify a settlement class under Federal Rule of Civil Procedure 23. Applying the Rule 23(a) requirements (numerosity, commonality, typicality, and adequacy of representation) along with Rule 23(b)(3)’s predominance and superiority requirements, the court found a settlement class appropriate. The class consists of all persons and entities who purchased or otherwise acquired Origin securities between February 23, 2023 and August 9, 2023, with standard exclusions for the defendants and their affiliates.<\/p>\n

On the substantive fairness analysis, the court applied the standards under Rule 23(e) for preliminary approval, considering whether the proposed settlement falls within the range of possible final approval. The court evaluated the strength of the plaintiffs’ case, the risk and expense of further litigation, the risk of maintaining class status, the amount offered, the stage of proceedings, the experience of counsel, and the absence of fraud or collusion. The court found that the $9 million amount, reached through arms-length negotiation with experienced counsel, was within the range that could ultimately be approved at the fairness hearing.<\/p>\n

The court approved the proposed notice to class members, set a schedule for objections and exclusion requests, and stayed all other proceedings pending final fairness review. Class counsel was authorized to seek attorneys’ fees, expenses, and a class representative enhancement award through a separate motion before the final fairness hearing.<\/p>\n

Key Takeaways<\/h2>\n