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Piedmont Office Realty Trust Inc. Securities Litigation

Practice: 
Securities Fraud & Shareholder Litigation
Phase: 
Current

Piedmont Office Realty Trust, Inc. (formerly known as Wells Real Estate Investment Trust, Inc.)

Chimicles & Tikellis LLP filed two class action lawsuits on behalf of shareholders of Wells Real Estate Investment Trust, Inc., now known as Piedmont Office Realty Trust:

Please visit both web pages on Chimicles & Tikellis LLP’s website to get complete information about the status of each pending lawsuit.

Washtenaw County ERS v. Piedmont Office Realty Trust, Inc.

Complaints:

Press Releases:

Other:

The Original Complaint was filed on October 25, 2007 by Chimicles & Tikellis LLP in the United States District Court for the Northern District of Georgia (October 26, 2007 Press Release).

After being appointed as Co-Lead Counsel in this Action, on May 19, 2008, Chimicles & Tikellis LLP filed an Amended Complaint in the United States District Court for the Northern District of Georgia (Case 1:07-cv-02660-CAP), alleging violations of the federal securities laws and breaches of fiduciary duty by nominal defendant Piedmont Office Realty Trust (f/k/a Wells Real Estate Investment Trust, Inc. ("Wells REIT") ("Piedmont" or "Company") and its directors W. Wayne Woody, Michael R. Buchanan, Wesley E. Cantrell, William H. Keogler, Jr., Donald S. Moss and Donald A. Miller (collectively the "Individual Defendants"), on behalf of: (a) a Class of all persons who were entitled to tender their shares pursuant to the Tender Offer Statement on Schedule TO under Section 14(d)(1) or 13(e)(1) of the Exchange Act, filed by Lex-Win Acquisition, LLC ("Lex-Win") on May 25, 2007, as Amended or Supplemented, and who suffered harm as a result of the actions complained of herein ("Tender Offer Class"); and (b) on behalf of a Class of all persons who were entitled to vote on the Final Proxy that was disseminated to investors, pursuant to Section 14(a) of the Exchange Act on October 16, 2007 ("Proxy Class").

Defendants moved to dismiss the complaint.  Plaintiff vigorously opposed Defendants' motion, and on March 30, 2009, the court issued a ruling, denying in part Defendants' motion.  On April 13, 2009, Defendants filed a motion with the court asking the court to reconsider its March 30, 2009 ruling, or, in the alternative, to certify certain issues for appeal to the federal appellate court.  Plaintiffs opposed Defendants' motion and the court has not yet ruled on the motion.

The Plaintiffs Washtenaw County Employees' Retirement System and Clara R. Smith filed the Second Amended Complaint 
on April 20, 2009.      

The Second Amended Complaint charges defendants with violations of the federal securities laws, including Sections 14(a) and 14(e) of the Securities Exchange Act of 1934 ("Exchange Act") and Rules 14a-9 and 14e-2(b) promulgated thereunder.

The Second Amended Complaint seeks to remedy the wrongdoing that was, and continues to be, inflicted against the shareholders of Piedmont who were entitled to tender their shares pursuant to tender offers made in May and June, 2007 by Lex-Win Acquisition, and seeks damages and injunctive relief on behalf of a Class of all shareholders of Piedmont who were entitled to vote on the false and misleading Final Proxy that was disseminated to investors on October 16, 2007 seeking their approval to extend the deadline, set forth in the Company’s charter, by which the Company was to list its shares on a national stock exchange or over the counter market, or liquidate.
Specifically, the Second Amended Complaint alleges, among other things, that:
1.        In response to the May 25 Lex-Win Tender Offer, Piedmont filed a Schedule 14D-9 which included the Board of Director’s recommendation that the shareholders not tender their shares to Lex-Win. The recommendation was largely based on "the current business plan in effect for the future of the Company as disclosed in the May 23 Registration, including a potential listing of its shares of common stock on a national exchange" and "the Board's belief that the timing of the Offer is intended to take advantage of any potential increase in the value of the Company's shares associated with a possible listing and trading of the Company's shares on a national exchange."
2.        Lex-Win amended its May 25 Tender Offer to increase the offer price to $9.30 per share and increase the number of shares sought to 9.3% of the outstanding shares (“Revised Tender Offer”).

3.        In response, Piedmont filed, on June 18, 2007, a Amendment No. 1 to its Schedule 14D-9, responding to the Revised Offer (“Amended Response”). This Amended Response included theBoard of Directors’ recommendation toPiedmont shareholders that they reject the Revised Offer. Without explanation or disclosure, the Amended Response omitted any reference to the May 23 Registration Statement or the potential listing as reasons for recommending against the Revised Tender Offer. On July 20, 2007, the Lex-Win Tender Offer expired.

4.        During the time that the Lex-Win Tender Offer was open and pending, the Directors knew or wrongfully disregarded that the listing of Piedmont's stock on a national securities exchange was highly unlikely. As of June 18, when the Company filed its Amended Response to the Revised Tender Offer, completely eliminating any reference to the May 23 Registration Statement or the prospective listing in providing the reasons for its recommendation against tendering, the Board had determined that the Underwritten Offering and listing were not likely to occur. The Board failed to supplement or amend its 14D-9 Solicitation/Recommendation Statement to disclose this material fact that would have been important to an investor in determining whether to tender his shares.

5.        Piedmont’s articles of incorporation (“Charter”) mandated that Piedmont commence a liquidation of its investments and make a subsequent distribution to shareholders (“Liquidation”), if, by January 30, 2008 (“Liquidity Deadline”) there was no Listing of Piedmont’s common stock. 

6.        Piedmont’s October 16, 2007 Proxy sought shareholder approval to amend the Charter to extend the January 30, 2008 Liquidity Deadline for up to three years at Piedmont’s Board of Director’s discretion. Plaintiffs allege the Proxy was allegedly false and misleading and omitted allegedly material information concerning: (i) statements about market conditions as a reason to extend the Liquidity Deadline; (ii) the alternatives to a Listing or extension of the Liquidity Deadline that were explored and considered during the evaluation that led to the recommendation of the Charter amendment to extend the Liquidity Deadline; (iii) the results of conversations Piedmont had with potential buyers in June and July 2007; and (iv) the specific limitations and details of Piedmont’s share redemption plan (“SRP”).               


The Second Amended Complaint seeks, among other things: (i) certification of the action as a class action on behalf of two classes of Piedmont shareholders: those who were entitled to tender their shares pursuant to the Lex-Win Tender Offers (“Tender Offer Class”), and those who were shareholders of record as of October 2, 2007 and were entitled to vote on the Proxy (“Proxy Class”); (ii) a judgment declaring the Schedule 14D-9s and Proxy false and misleading; (iii) monetary damages; (iv) nullification of shareholder approval of the extension of the Liquidity Deadline and amendments to the Charter, and rescission of the amendments; and (viii) the payment of reasonable attorneys’ fees and expenses.

Defendants answered the Second Amended Complaint on May 11, 2009, denying all of the Second Amended Complaint’s substantive allegations, and raised certain defenses. 

If you wish to discuss this Action further, have any questions concerning this notice or your rights or interests, or need additional information on this Action please contact the attorneys below.

Attorneys to Contact: 
Nicholas E. Chimicles (Nick@chimicles.com)
Kimberly Donaldson Smith (KimDonaldsonSmith@chimicles.com)
Kimberly Litman Kimmel (KimberlyKimmel@chimicles.com)
361 West Lancaster Avenue, Haverford, PA 19041 Phone: 610-642-8500

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