1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 NATHAN FELDMAN, Case No. 25-cv-06105-NW

8 Plaintiff, ORDER APPOINTING LEAD 9 v. PLAINTIFF AND LEAD COUNSEL

10 ALTO NEUROSCIENCE, INC., et al., Re: ECF Nos. 21, 23 Defendants. 11

12 13 This is a securities putative class action brought against Alto Neuroscience, Inc. and its 14 directors (collectively “Alto”). Before the Court are two motions to serve as lead plaintiffs and 15 lead counsel, the first from Special Situations Cayman Fund, L.P., Special Situations Fund III QP, 16 L.P., and Special Situations Life Sciences Fund, L.P. (collectively, the “Special Situations Funds” 17 or “SSF”) and the second from Eileen Beiter and Nathan Feldman (the “Individuals”). Having 18 considered the parties’ briefs and the relevant legal authority, and concluding that oral argument is 19 not required, see N.D. Cal. Civ. L.R. 7-1(b), VACATES the hearing set for December 3, 2025. 20 For the reasons stated below, the Court GRANTS SSF’s motion and DENIES the Individuals’ 21 motion. 22 I. BACKGROUND 23 This action alleges that Alto, a clinical-stage biopharmaceutical company, made false and 24 misleading statements by and through its directors in connection with the company’s IPO in 25 February 2024. When information came to light in November 2024 related to the alleged 26 misrepresentations, Alto’s stock price plummeted more than 70%. 27 On July 21, 2025, Plaintiff Nathan Feldman filed the instant Complaint, asserting claims 1 §§ 78j(b) and 78t(a). Compl. ¶¶ 64–71. That same day, counsel for Plaintiff published a notice 2 informing investors of the pendency of this action and of their right to seek appointment as lead 3 plaintiff within sixty days. On September 19, 2025, four class members timely filed motions to 4 serve as lead plaintiff. ECF Nos. 17, 21, 23, 24. Since then, two movants withdrew their motions, 5 see ECF Nos. 32, 33, leaving only SSF and the Individuals as candidates for lead plaintiff. 6 II. LEGAL STANDARD 7 A. Lead Plaintiff 8 Section 21D(a)(3)(B) of the Securities Exchange Act of 1934, 15 U.S.C. § 78u-4(a)(3)(B), 9 as amended by the PSLRA, governs appointment of lead plaintiffs in all private securities class 10 actions. See 15 U.S.C. §§ 77z-1(a)(3), 78u-4(a)(3). The district court shall appoint as lead 11 plaintiff “the member or members of the purported plaintiff class that the court determines to be 12 most capable of adequately representing the interests of class members,” also referred to as the 13 “most adequate plaintiff.” §§ 77z-1(a)(3)(B)(i), 78u-4(a)(3)(B)(i). 14 The PSLRA “provides a simple three-step process for identifying the lead plaintiff.” In re 15 Cavanaugh,

, 729 (9th Cir. 2002). At the first step, the pendency of the first-filed 16 action, the claims made, and the purported class period must be publicized in a “widely circulated 17 national business-oriented publication or wire service.” Id. (internal quotation marks and citation 18 omitted). Second, the court must identify the presumptive lead plaintiff, i.e., “the movant with the 19 largest financial interest who otherwise satisfies the requirements of Rule 23 of the Federal Rules 20 of Civil Procedure.” In re Mersho,

, 899 (9th Cir. 2021) (internal quotation marks and 21 citation omitted). “At step three, the process turns adversarial,” Mersho, 6 F.4th at 899, and other 22 hopeful plaintiffs may attempt to “rebut the presumptive lead plaintiff’s showing that it satisfies 23 Rule 23’s typicality and adequacy requirements.” Cavanaugh, 306 F.3d at 730. “If the 24 presumption is not rebutted, the presumptively most adequate plaintiff must be selected as lead 25 plaintiff.” Mersho, 6 F.4th at 899. 26 B. Lead Counsel 27 Under the PSLRA, the lead plaintiff has the right, subject to court approval, to select and 1 2009). “[I]f the lead plaintiff has made a reasonable choice of counsel, the district court should 2 generally defer to that choice.” Id. at 712. 3 III. DISCUSSION 4 A. Lead Plaintiff 5 The Court finds, and no party disputes, that publication of notice of this lawsuit was 6 completed within the required timeframe. Further, the Individuals concede that SSF’s alleged 7 financial loss—more than $5 million—far outweighs the Individuals’ combined loss of 8 approximately $28,000. The only remaining issue, then, is whether SSF satisfies the typicality 9 and adequacy requirements required under Rule 23. The Individuals claim that SSF fails both 10 conditions; SSF disagrees. 11 The Individuals’ argue that SSF is an atypical, inadequate lead plaintiff for two reasons: 12 (1) the term “Special Situations,” which is part of the title of each fund in SSF, indicates that SSF 13 handles special investments that render SSF unlike most other investors; and (2) SSF is subject to 14 unique defenses because it had facially contradictory trading strategies amongst its three funds on 15 a single day. According to the Individuals, these “facts” demonstrate that SSF did not rely on the 16 misstatements at issue in this action, making them unsuitable for appointment as lead plaintiff. 17 The Individuals’ arguments offer only speculation. “The PSLRA requires ‘proof’ to 18 overcome the presumption entitling the plaintiff with the largest financial interest in the litigation 19 to appointment as lead plaintiff.” Schlaegel v. Palo Alto Networks Inc.,

, at *4 20 (N.D. Cal. Aug. 9, 2024) (citations omitted). Instead of providing proof, the Individuals merely 21 pose rhetorical questions regarding SSF’s suitability as lead plaintiff, presumably hoping the Court 22 will assume that if SSF is ever called to answer these questions, SSF will have disqualifying, 23 rather than innocuous, answers. See e.g., Ind. Opp’n at 9, (“[W]hat ‘special situation’ had [the 24 SSF] portfolio manager identified that informed [SSF’s] Class Period transactions?”), 13 (“What 25 will the Funds’ portfolio manager say at his deposition when he is inevitably asked to explain his 26 contradictory trading on behalf of the different funds?”). The Court will not engage in this 27 speculation, which “is insufficient to rebut the presumption” that the presumptive lead plaintiff 1 1836RSM,

, at *5 (W.D. Wash. Feb. 14, 2014). 2 While the Court has noticed that SSF has made errors in its papers, including a request for 3 consolidation of supposed “Related Actions” where none exist, see SSF Mot. at 10-11 (indicating 4 in present tense that related actions “here” have common questions of law and fact), those errors 5 do not “give the Court pause about appointing” SSF as lead plaintiff as the Individuals urge. 6 Courts generally do not find that immaterial or clerical mistakes render a movant inadequate 7 without more. See, e.g., In re Solar City Corp. Sec. Litig., No. 16-CV-04686-LHK,

363274, at *6 (N.D. Cal. Jan. 25, 2017) (finding “minor or inadvertent mistakes” did not prevent 9 appointment as lead plaintiff); Banerjee v. Avinger, Inc., No. 17-CV-03400-CW,

4552063, at *3 (N.D. Cal. Oct. 11, 2017) (same). In the Court’s view, none of the errors rise to 11 the level of being material, even if those errors demonstrate SSF could have acted more carefully 12 in crafting their motion. 13 Accordingly, the Court finds SSF to be an adequate lead plaintiff. The Court GRANTS 14 SSF’s motion. 15 B. Lead Counsel 16 The PSLRA requires the lead plaintiff shall, subject to court approval, select and retain 17 counsel to represent the putative class. 15 U.S.C. § 78U-4(a)(3)(B)(v). “A court may only 18 override the lead plaintiff’s choice of counsel where the court believes it necessary to protect the 19 interests of the class.” Schriver v. Impac Mortg. Holdings, Inc., No. SACV 06-31 CJC RNBX, 20

, at *11 (C.D. Cal. May 2, 2006) (internal quotation marks omitted); see also 21 Cavanaugh, 306 F.3d at 374 (“While the appointment of counsel is made subject to the approval 22 of the court, the [PSLRA] clearly leaves the choice of class counsel in the hands of the lead 23 plaintiff.”). SSF has selected Rolnick Kramer Sadighi LLP (“RKS”) to serve as its counsel. The 24 firm has extensive experience litigating securities class actions and has been appointed lead 25 counsel or co-lead counsel in several such actions. See, e.g., Special Situations Fund III QP, L.P. 26 v. Marrone Bio Innovations, Inc., Case No. 2:14-cv-02571 (E.D. Cal.). The Individuals do not 27 \\ ] dispute that RKS is qualified to prosecute this action. Therefore, the Court appoints RKS as lead 2 || counsel. 3 IT IS SO ORDERED. 4 Dated: December 1, 2025 , 5 Noél Wise 6 United States District Judge 7 8 9 10 1] a 12 2B

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