Trunkbow International Holdings Limited Shareholder Litigation Website
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Welcome to the Trunkbow International Holdings Limited Shareholders' Litigation Website

This website has been established to provide general information related to the Trunkbow International Holdings Limited  ("Trunkbow" or the "Company") Shareholders' Litigation. This Litigation is pending in the District Court for Clark County, Nevada.

History and Background of the Action

On November 2, 2012, Trunkbow announced that Dr. Wanchun Hou, chairman of the Company’s board of directors (“Dr. Hou”), and Mr. Qiang Li, chief executive officer and a director of the Company (“Mr. Li”), proposed to the Company’s board of directors (the “Board”) that they would acquire all the outstanding shares of the Company common stock not already beneficially owned by Dr. Hou and Mr. Li for US $1.46 per share in cash (the “Proposal”). The Company also announced that the Board formed a special committee of independent directors (the “Special Committee”) consisting of Dr. Kokhui Tan, Dr. Tingjie Lv, and Mr. Zhaoxing Huang to consider the Proposal.

The “Hansen Action” was filed before the Court and on November 14, 2012. The “Davis Action” was filed before the Court. Both actions were purportedly filed on behalf of all shareholders of the Company, other than the named defendants and their respective affiliates, challenging the Proposal.

In and around mid-February 2013, Dr. Hou and Mr. Li decided to suspend the proposed going-private transaction to focus on the management and operations of the Company. This decision was made in response to business challenges faced by the Company, which, in January 2013, experienced certain delays in concluding sales contracts with key customers and received indications from its key customers that they might decrease or delay the procurement of the Company’s products in the first two quarters of 2013.

In early September 2013, Dr. Hou and Mr. Li considered resuming the proposed going-private transaction in anticipation of the Company’s improved business operations in the third quarter of 2013, which primarily resulted from the management’s efforts to enhance the Company’s sales and marketing and to improve the operational efficiency of the Company.

Between December 20, 2013 and January 7, 2014, five additional actions were filed in the Court purportedly on behalf of all stockholders of the Company, other than the named defendants and their respective affiliates, asserting claims against Trunkbow, Parent, Merger Sub, Dr. Hou, Mr. Li and other members of the Board (collectively, the “Defendants”). The complaints generally alleged that the Merger Agreement was entered into as a result of an unfair process and for an unfair price and the Defendants breached, or aided and abetted the breach of, fiduciary duties to the Company’s stockholders. In addition, the Morgan, Hertel, Sun and Fontaine Actions alleged that the Preliminary Proxy Statement omitted information necessary for it not to be materially misleading and asserted claims for violation of the duty of candor.

The Parties agreed to the confidential exchange of informal expedited discovery, including the deposition of Dr. Kokhui Tan, the Chairman of the Special Committee, and the deposition of Robert Bartell, a Managing Director of Duff & Phelps. Between February 12, 2014 and March 11, 2014, pursuant to Plaintiffs’ document requests, the Company produced confidential documents including, but not limited to, the engagement letter between the Company and Duff & Phelps, minutes of meetings of the Board and the Special Committee, presentations made to the Board by Duff & Phelps, financial projections prepared by management, and other documents relating to the Merger.

On August 6, 2014, the Appearing Parties entered into the Stipulation embodying the Settlement.

The Settlement

As a direct result of the prosecution of the Action and the negotiations between the Parties, a Settlement has been reached under the following terms:

On April 7, 2014, as a result of the pendency and prosecution of the Action, but without admitting any wrongdoing, Trunkbow filed the Supplemental Disclosures with the SEC on Schedule 14A, prior to the special meeting of the Trunkbow stockholders to vote on the Merger Agreement, a copy of which is attached hereto as Exhibit A, in return for the release of the Released Persons (as defined in the Stipulation) from the Released Claims (as defined in the Stipulation).

Defendants have also agreed, pursuant to the terms in the Stipulation, that Trunkbow (or its successors in interest) shall pay, on behalf, and for the benefit, of Defendants in the Action, all costs and expenses incurred in providing this Notice, as well as any reasonable costs and expenses related to the administration of the Settlement. Plaintiffs have agreed to dismiss the Action with prejudice, which dismissal will be incorporated into an Order and Final Judgment.

Trunkbow has also agreed, pursuant to the terms in the Stipulation, that Trunkbow (or its insurer(s) or successor(s)), on behalf of itself and for the benefit of the other Defendants in the Action, shall pay, or cause to be paid to Plaintiffs’ Counsel, fees in an amount not to exceed $600,000, plus all reasonable and documented expenses not to exceed an aggregate amount of $25,000.

If you are a Class Member, you (1) will be bound by any judgment entered in this Action whether or not you actually receive this Notice; and (2) will be barred from seeking further relief on the claims asserted in the Action. The full terms of the Settlement are set forth in the Stipulation (see Section X in the Notice).

The Settlement Class includes all Persons or entities who held Trunkbow International Holdings Limited from November 2, 2012, through and including April 14, 2014, except those Persons and entities that are excluded as described in the Notice.

The Settlement Hearing

The proposed Settlement and the Fee Petition are subject to approval by the Court. The Settlement Hearing will be held before the Court on December 22, 2014 at 9:00 a.m., at the Eighth Judicial District Court, Regional Justice Center, 200 Lewis Avenue, Las Vegas, Nevada, to (i) determine whether the Court should certify a non-opt out class consisting of all persons or entities who held shares of Trunkbow, either of record or beneficially at any time from and including November 2, 2012 through April 14, 2014; (ii) determine whether the Court should grant final approval of the proposed Settlement on the terms and conditions provided for in the Stipulation as fair, reasonable and adequate, and whether the Order and Final Judgment as provided for in the Stipulation should be entered by the Court; (iii) determine whether judgment should be entered pursuant to the Stipulation, inter alia, dismissing the Action with prejudice on the merits; (iv) consider the Fee Petition and determine whether, and in what amount, the Court should approve the Fee Petition; (v) determine whether all Released Claims should be fully, finally and forever be released as set forth in the Stipulation; (vi) determine whether to bar and enjoin the prosecution of all Released Claims against any released Person, including but not limited to any claims for attorneys’ fees and expenses (including but not limited to any such claims arising out of, relating to, or in connection with the Settlement), except as otherwise provided for in the Stipulation; and (vii) hear and determine other matters relating to the proposed Settlement.

If you file and serve a timely written objection to the Settlement or the Fee Petition, you may appear at the Settlement Hearing in person or through an attorney retained at your own expense. If you wish to appear at the Settlement Hearing, you must notify the Court and counsel IN WRITING of your intention to do so, with your written objection filed as described in this Notice. Do not call or personally contact the Court about matters set forth in this Notice.

In the event that the Court does not enter the Order and Final Judgment approving the Settlement for any reason whatsoever, or if that Order and Final Judgment is materially modified, vacated, or reversed on appeal, then the Settlement shall be null and void. The full and complete description of the terms and conditions of the Settlement may be found in the Stipulation, which is on file with the Court.

The Notice

Although the information in this website is intended to assist you, it does not replace the information contained in the Notice of Pendency of Class Action, Proposed Settlement, Settlement Hearing and Right to Appear (the "Notice") which can be found and downloaded from this website. We recommend that you read the Notice and other relevant case documents carefully.