Treasurer of New Jersey v. AOL Time Warner Inc., No. MER-L-1349-03 (N.J. Super. Ct.) Pomerantz, together with co-counsel, litigated claims under Sections 11 and 12 of the Securities Act, and also under state law, for New Jersey’s Treasury Department, its Division of Investment, and the five major funds the Division supervises in this opt-out action filed in state court against AOL and Time Warner arising from defendants’ accounting manipulations to inflate revenues. Here, our clients had significant losses and, moreover, their Section 11 and 12 claims were much easier to establish than the Section 10(b) claims held by most class members — factors strongly warranting individual action. We recommended that New Jersey pursue its claims in state, rather than federal, court for strategic and convenience reasons. After defeating an initial motion to dismiss, we engaged in discovery with the help of experts. Loss causation and damage calculations were especially challenging because of numerous partial and “proxy” disclosures, as well as the tremendous decline in the price of the securities throughout the relevant period. We nevertheless obtained a $50 million settlement, which represented a significant multiple of what New Jersey would have recovered in the class action settlement.