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10 UNITED STATES DISTRICT COURT

11 SOUTHERN DISTRICT OF CALIFORNIA

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13 IN RE RYVYL INC. DERIVATIVE Case No.: 3:23-cv-1165-GPC-SBC

LITIGATION,

14

ORDER:

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16 THIS DOCUMENT RELATES TO: ALL GRANTING MOTION FOR FINAL

APPROVAL OF SETTLEMENT AND

17 ACTIONS AWARD OF ATTORNEYS’ FEES,

EXPENSES, AND SERVICE

18

AWARDS

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[ECF Nos. 26, 28]

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21 Before the Court is the Parties’ joint motion for final approval of the parties’

22 derivative settlement agreement, ECF No. 26, and Plaintiffs’ unopposed motion for an

23 order approving an award of attorneys’ fees and expenses, ECF No. 28. On January 9,

24 2026, the Court held a final settlement hearing on this matter. ECF No. 30. For the reasons

25 detailed below, the Court GRANTS both motions.

26 BACKGROUND

27 I. Factual Allegations

28 This is a shareholder derivative action on behalf of nominal defendant RYVYL, Inc.

1 (“RYVYL” or “the Company”) against current and former RYVYL directors and officers

2 (the “Individual Defendants,” 1 and together with RYVYL, the “Defendants”). RYVYL is

3 a financial technology company “centered on disrupting the payments industry by offering

4 multiple blockchain encoded payment processing solutions for individuals and

5 businesses.” ECF No. 1, at 2-3. Plaintiffs allege that the Individual Defendants failed to

6 implement adequate internal controls to prevent materially false and misleading financial

7 information from being published by RYVYL. ECF No. 26-1, at 8-9. Plaintiffs further

8 allege that controlling RYVYL shareholders participated in a scheme to cause RYVYL to

9 overpay for repurchases of its own stock while the stock price was artificially inflated due

10 to the alleged false and misleading statements, resulting in alleged violations of §§ 10(b),

11 14(a), and 20 of the Exchange Act and violations of state law, including breach of the

12 fiduciary duties owed to RYVYL. Id.

13 II. Procedural Background

14 On February 1, 2023, a putative class action lawsuit titled Cullen v. RYVYL Inc. fka

15 GreenBox POS, Inc., et al., Case No. 3:23-cv-00185-GPC-AGS (the “Securities Class

16 Action”), was filed in this Court against several defendants, including RYVYL and certain

17 of its current and former directors and officers, alleging substantially similar facts as those

18 alleged in this derivative litigation. See ECF No. 18, at 3-4. The parties in the Securities

19 Class Action executed a stipulation and agreement of settlement on July 9, 2025. Id. The

20 Court held a final fairness hearing on the class action settlement on December 19, 2025,

21 after which the Court granted final approval of the class action settlement and directed the

22 clerk to close the case. See Cullen v. RYVYL Inc. fka GreenBox POS, Inc., et al., No. 3:23-

23 CV-00185-GPC-SBC, 2025 WL 3731036 (S.D. Cal. Dec. 19, 2025).

24 On June 22, 2023, the first of two shareholder derivative actions in this Court—

25 Christy Hertel, derivatively on behalf of RYVYL Inc., f/k/a GreenBox POS v. Ben Errez et

26

27

1 The Individual Defendants are Ben Errez, Fredi Nisan, Benjamin Chung, Genevieve Baer, William

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1 al., Case No. 3:23-CV-01165-GPC-SBC—was filed against RYVYL’s current and former

2 officers and directors. ECF No. 18, at 4-5. On August 4, 2023, the second shareholder

3 derivative action—Marcus Gazaway, derivatively on behalf of RYVYL Inc., f/k/a GreenBox

4 POS v. Ben Errez et al., Case No. 3:23-CV-01425-LAB-BLM—was filed in this Court

5 against the same Defendants. ECF No. 18, at 4-5. Both derivative actions make the same

6 allegations against Defendants and seek damages and contribution from Defendants, as

7 well as actions to reform and improve corporate governance and internal procedures to

8 ensure compliance with applicable laws. Id. The Defendants deny all allegations of

9 wrongdoing or liability asserted in the shareholder derivative actions. Id. at 5.

10 On March 18, 2024, the Parties to these two derivative actions jointly moved to

11 consolidate their cases. ECF No. 10. On April 2, 2024, the Court granted the Parties’ joint

12 motion and consolidated the actions under the caption In re RYVYL Inc. Derivative

13 Litigation, case number 3:23-cv-01165-GPC-SBC. ECF No. 11. The Court subsequently

14 appointed The Brown Law Firm, P.C., as lead counsel for Plaintiffs in the derivative

15 lawsuits before this Court. ECF No. 15.

16 On May 1, 2024, a third, substantially similar shareholder derivative complaint was

17 filed in Clark County, Nevada, by Plaintiff Christina Brown. ECF No. 18, at 5. The two

18 derivative actions consolidated before this Court, along with the Nevada State Action, are

19 collectively referred to in this order and in the Stipulation of Settlement as the “Derivative

20 Lawsuits.” See ECF No. 18, at 5; ECF No. 27-1, at 7 n.1.

21 On May 8, 2025, all parties in the Derivative Lawsuits reached an agreement in

22 principle to fully resolve and settle all claims alleged in the Derivative Lawsuits, subject to

23 approval by this Court. ECF No. 18, at 5. All parties executed a Stipulation of Settlement

24 on September 30, 2025, ECF No. 18, and moved for the Court’s preliminary approval of

25 the settlement on October 7, 2025. ECF No. 19.

26 After a hearing on November 14, 2025, the Court granted provisional approval of

27 the derivative action settlement and conditionally approved the proposed form and manner

28 of notice. ECF No. 23.

1 III. Settlement Agreement

2 The summarized key terms of the Stipulation and Agreement of Settlement (the

3 “Stipulation”), ECF. No. 18, are as follows:

4 A. Terms

5 RYVYL will adopt the corporate governance reforms set forth in Exhibit A of the

6 Stipulation, ECF No. 18-1, and keep them in place for at least three years. ECF No. 18, at

7 15. These reforms include, but are not limited to:

8 1. Establishing a Risk & Disclosure Committee;

9 2. Expanding the Board of Directors to add an additional independent

10 director;

11 3. Improving RYVYL’s Related Party Transactions Policy;

12 4. Expanding and documenting the duties of the Company’s new Vice

13 President, Legal;

14 5. Enhancing RYVYL’s internal controls and compliance function, the

15 Board’s oversight of stock repurchases, and RYVYL’s whistleblower

16 policy;

17 6. Improving the charters for the Audit Committee, Nominating

18 Committee, and Compensation Committee; and

19 7. Providing for improved employee training in risk assessment and

20 compliance.

21 See ECF No. 18-1, at 2-4.

22 B. Releases

23 Per the Stipulation, the Released Claims shall be finally and fully compromised,

24 settled, and released, and the Derivative Lawsuits shall be dismissed with prejudice as

25 against all Released Persons. ECF No. 18, at 8-9.

26 The “Released Claims” include all claims or causes of action including, but not

27 limited to:

28 [A]ny claims for damages, injunctive relief, interest, attorneys’

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of the Released Persons that: (i) were asserted or could have been

3 asserted derivatively in the Derivative Lawsuits; (ii) would have

been barred by res judicata had the Derivative Lawsuits been

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fully litigated to final judgment; (iii) that have been, could have

5 been, or could in the future be, asserted derivatively in any forum

or proceeding or otherwise against any of the Released Persons

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that concern, are based upon, involve, or arise out of, or relate to

7 any of the subject matters, allegations, transactions, facts, events,

occurrences, disclosures, representations, statements, omissions

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alleged, acts, failures to act, alleged mismanagement,

9 misconduct, concealment, alleged misrepresentations, alleged

violations of local, state or federal law, sale of stock, or other

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matters involved, set forth, or referred to, or could have been

11 alleged in or encompassed by, the complaints in the Derivative

Lawsuits; or (iv) arise out of, relate to, or concern the defense,

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settlement, or resolution of the Derivative Lawsuits or the

13 Released Claims.

14 ECF No. 18, at 12-13.

15 The Released Claims do not include claims to enforce the terms of the Stipulation

16 nor exclusively direct claims absent RYVYL stockholders may have in an individual

17 capacity against Defendants. Id. at 13.

18 The Released Persons include Defendants’ Counsel and each of the Defendants and

19 their respective past, present, or future heirs, trusts, trustees, estates, beneficiaries, and

20 other entities with whom they have legally binding relationships of duties. Id. at 13.

21 Defendants also release all claims arising out of the commencement, litigation, or

22 settlement of the Derivate Lawsuits as against Plaintiffs, Plaintiffs’ Counsel, and any past,

23 present, or future entities with whom they have legally binding relationships or duties. Id.

24 at 9-10, 20-21.

25 Lastly, should the Court approve the Settlement, the parties in the Nevada State

26 Action will file a notice of voluntary dismissal with prejudice and/or a stipulation of

27 voluntary dismissal with prejudice in that action. Id. at 20.

28 C. Attorneys’ Fees and Expenses

1 Plaintiffs’ counsel seeks—and Defendants have agreed to pay—$200,000 in

2 attorneys’ fees and costs, which is comprised of $25,000 in cash and Settlement Shares

3 worth $175,000 (the “Fee and Expense Amount”). ECF No. 18, at 16-17.

4 Plaintiffs’ counsel also request a service award of $500 for each of the three named

5 Plaintiffs in the three Derivative Lawsuits. ECF No. 18, at 19-20. These awards will be

6 drawn from the funds allocated for Plaintiffs’ attorneys’ fees and expenses. Id.

7 D. Notice

8 RYVYL provided notice of the Settlement consistent with the proposed notice plan

9 preliminarily approved in the Courts preliminary approval order. See ECF No. 25.

10 Specifically, RYVYL: (1) posted a link to the Notice, ECF No. 18-3, and the Stipulation

11 and Agreement of Settlement, ECF No. 18, on the Investor Relations page of its website;

12 (2) issued a press release describing the Form 8-K, the Preliminary Approval Order, the

13 Notice, and the Stipulation on GlobeNewswire; and (3) filed the Preliminary Approval

14 Order, the Stipulation, the Notice, and the press release with the U.S. Securities and

15 Exchange Commission as exhibits to a Form 8-K. ECF No. 25, at 2.

16 DISCUSSION

17 I. Motion for Final Approval

18 A. Legal Standard

19 A derivative action may be settled only with the court’s approval. Fed. R. Civ. P.

20 23.1(c). “In determining whether to approve the settlement of a derivative action, courts

21 look to cases and standards under Rule 23(e) of the Federal Rules of Civil Procedure for

22 guidance by analogy.” In re CPI Aerostructures S’holder Derivative Litig., No. 20-cv-

23 2092, 2023 WL 2969279, at *3 (E.D.N.Y. Feb. 14, 2023); see also In re OSI Sys., Inc.

24 Derivative Litig., No. CV-14-2910-MWF, 2017 WL 5634607, at *1 (C.D. Cal. Jan. 24,

25 2017) (When reviewing a derivative action settlement for approval, “[t]he Court takes as

26 instructive case law governing preliminary approval of class action settlements under Rule

27 23(e)”).

28 “Rule 23 requires courts to employ a two-step process in evaluating a class action or

1 derivative action settlement.” In re Wells Fargo & Co. S'holder Derivative Litig., 445 F.

2 Supp. 3d 508, 516 (N.D. Cal. 2020), aff'd, 845 F. App'x 563 (9th Cir. 2021). First, the court

3 “must make a preliminary determination that the settlement is ‘fair, reasonable, and

4 adequate’” under Rule 23(e)(2). Id. at 517 (quoting Fed. R. Civ. P. 23(e)(2)). “Second, if

5 the court preliminarily approves a derivative action settlement, notice ‘must be given to

6 shareholders or members in the manner that the court orders.’” Hu v. Baker, No. 4:23-CV-

7 02077-KAW, 2025 WL 2419265, at *5 (N.D. Cal. Aug. 21, 2025) (quoting Fed. R. Civ. P.

8 23.1(c)). The court then holds a hearing to “make a final determination whether the

9 settlement is ‘fair, reasonable, and adequate.’” Id. (quoting Fed. R. Civ. P. 23(e)(2)).

10 When considering a derivative action settlement, courts evaluate fairness,

11 reasonableness, and adequacy by considering a range of factors, such as “the strength of

12 the plaintiffs’ case; the risk, expense, complexity, and likely duration of further

13 litigation . . . the amount offered in settlement; the extent of discovery completed and the

14 stage of the proceedings; [and] the experience and views of counsel[.]” Id. (quoting Hanlon

15 v. Chrysler Corp., 150 F.3d 1011, 1027 (9th Cir. 1998)). However, the principal factor that

16 courts consider is “the extent of the benefit to be derived from the proposed settlement by

17 the corporation, the real party in interest.” In re Pinterest Derivative Litig., No. C 20-

18 08331-WHA, 2022 WL 484961, *3 (N.D. Cal. Feb. 16, 2022) (quoting In re Apple

19 Computer, Inc. Derivative Litig., No. C 06-4128 JF (HRL), 2008 WL 4820784, at *2 (N.D.

20 Cal. Nov. 5, 2008)).

21 A court must further ensure that the proposed settlement is “not the product of fraud

22 or overreaching by, or collusion between, the negotiating parties.” In re Hewlett-Packard,

23 No. 3:12-CV-06003-CRB, 2015 WL 1153864, at *3 (N.D. Cal. Mar. 13, 2015) (quoting In

24 re NVIDIA Corp. Derivative Litig., No. C–06–06110–SBA, 2008 WL 5382544, at *2 (N.D.

25 Cal. Dec. 22, 2008)). “The reaction of shareholders also factors into assessing the fairness

26 of a settlement.” In re Pinterest Derivative Litig., No. C 20-08331-WHA, 2022 WL

27 2079712, at *1 (N.D. Cal. June 9, 2022).

28 B. Adequacy of Notice

1 Rule 23.1(c) requires that notice of the Settlement “must be given to shareholders or

2 members in the manner that the court orders.” Fed. R. Civ. P. 23.1(c). Notice to

3 shareholders “must be ‘reasonably calculated, under all the circumstances, to apprise

4 interested parties of the pendency of the action and afford them an opportunity to present

5 their objections.’” Lloyd v. Gupta, No. 15-CV-04183-MEJ, 2016 WL 3951652, at *6 (N.D.

6 Cal. July 22, 2016) (quoting Mullane v. Cent. Hanover Bank & Tr. Co., 339 U.S. 306, 314

7 (1950)). In determining whether the proposed notice method is adequate, “the Court

8 considers whether such notice would be sufficient to reach the majority of interested

9 stockholders.” Bushansky v. Armacost, No. 12–CV–01597–JST, 2014 WL 2905143, at *6

10 (N.D. Cal. June 25, 2014) (citing 7C Wright & Miller’s Federal Practice & Procedure

11 § 1839 (3d. ed.)).

12 The Court previously approved the Parties’ notice plan. ECF No. 23, at 13-16. After

13 approval, counsel submitted a declaration and documentation demonstrating their

14 implementation of that plan. ECF No. 25. On November 21, 2025, RYVYL (1) posted a

15 link to the Notice, ECF No. 18-3, and the Stipulation and Agreement of Settlement, ECF

16 No. 18, on the Investor Relations page of its website; (2) issued a press release describing

17 the Form 8-K, the Preliminary Approval Order, the Notice, and the Stipulation on

18 GlobeNewswire; and (3) filed the Preliminary Approval Order, the Stipulation, the Notice,

19 and the press release with the U.S. Securities and Exchange Commission as exhibits to a

20 Form 8-K. ECF No. 25, at 2.

21 The deadline for shareholders to submit objections to the Settlement was December

22 26, 2025. Despite the robust notice program approved by this Court, no shareholder

23 submitted an objection to the Settlement. See ECF No. 29, at 3.

24 Given these efforts, the Court concludes that the notice provided by the parties has

25 satisfied Rule 23.1 and due process. See, e.g., In re Wells Fargo & Co. S'holder Derivative

26 Litig., 445 F. Supp. 3d at 517-18; Bushansky, 2014 WL 2905143, at *6 (collecting cases).

27 C. Fairness, Adequacy, and Reasonableness of Settlement

28 In its Preliminary Order, the Court analyzed several factors and found the Settlement

1 to be fair, adequate, and reasonable. ECF No. 23, at 8-13. The Court has no reason to alter

2 its determination now that shareholders have received notice, had an opportunity to file

3 objections, and declined to do so. Thus, the analysis herein will be substantially like the

4 analysis contained within the Preliminary Approval Order. ECF No. 23.

5 1. Benefits to RYVYL

6 The Parties assert that the Settlement will provide RYVYL with “the benefits of a

7 comprehensive set of policy, governance, internal controls, and oversight enhancements

8 designed to address the specific alleged policy, decision-making, and oversight lapses that

9 are alleged to have resulted in legal and financial exposure.” ECF No. 26-1, at 15. The

10 parties maintain that the Settlement will “provide real, substantial, and long-lasting benefits

11 for RYVYL and its shareholders.” Id.

12 “[A] corporation may receive a ‘substantial benefit’ from a derivative suit . . .

13 regardless of whether the benefit is pecuniary in nature.” Mills v. Elec. Auto-Lite Co., 396

14 U.S. 375, 395 (1970); see also In re Ceradyne, Inc., No. SACV 06-919-JVS (PJWx), 2009

15 WL 10671494, at *2 (C.D. Cal. June 9, 2009) (“Non-pecuniary benefits to the corporation

16 have been deemed adequate consideration for the settlement of derivative suits . . . [and]

17 can be particularly valuable when the relief is intended to prevent future harm” (internal

18 quotation marks and citations omitted)). “Courts have recognized that corporate

19 governance reforms . . . provide valuable benefits to public companies.” In re NVIDIA

20 Corp. Derivative Litig., 2008 WL 5382544, at *3 (quoting Cohn v. Nelson, 375 F. Supp.

21 2d 844, 853 (E.D. Mo. 2005)).

22 When evaluating the adequacy of nonmonetary settlement provisions like corporate

23 governance reforms, courts examine whether a company is already undertaking the

24 provisions independently of the settlement. If the reforms proposed in the settlement were

25 already implemented or going to be implemented by the company, then courts are more

26 doubtful of the value of the settlement. See In re Lyft, Inc. Derivative Litig., No. 20-CV-

27 09257-HSG, 2024 WL 4505474, at *4 (N.D. Cal. Oct. 16, 2024) (“[T]he Court is skeptical

28 that the reforms presented here are a benefit of the settlement rather than [the company’s]

1 own independent actions.”) (emphasis in original); In re Pinterest Derivative Litig., No. C

2 20-08331-WHA, 2022 WL 2079712, at *3 (N.D. Cal. June 9, 2022) (critical of the fact that

3 “a fair number of the reforms were already in place as a result of the corporation’s own

4 actions addressing the [underlying action’s allegations]”).

5 Courts are more likely to deem corporate governance reforms beneficial to a

6 company in a derivative action settlement when the reforms directly address alleged

7 corporate misconduct. See Moore v. Verb Tech. Co., Inc., No. CV 19-8393-GW-MAAx,

8 2021 WL 11732976, at *4 (C.D. Cal. Mar. 1, 2021) (finding that “corporate governance

9 measures that specifically address the allegations in the derivative action” substantially

10 benefit the company by helping prevent it from making additional misleading statements

11 about its business); In re Taronis Techs., Inc. S'holder Derivative Litig., No. CV-19-04547-

12 PHX-GMS, 2021 WL 842137 (D. Ariz. Mar. 5, 2021) (finding that corporate governance

13 changes conferred sufficient benefit to company because they addressed compliance with

14 public reporting requirements that the company had allegedly not complied with).

15 The Court agrees with the Parties that the corporate governance reforms listed in

16 Exhibit A of the Stipulation benefit RYVYL. Though non-pecuniary, the reforms directly

17 address the alleged deficiencies listed in Plaintiffs’ Derivative Lawsuits. For example, the

18 reforms require the establishment of a Risk & Disclosure Committee, provide for an

19 updated and expanded Insider Trading Policy, ensure related party transactions are fair and

20 fully disclosed by improving and clarifying the Related Party Transactions Policy, and

21 expand objective oversight by the Board of Directors by adding an independent director

22 and broadening the Board’s oversight of stock repurchases. ECF No. 26-1, at 16; see

23 generally ECF No. 18-1. These directly respond to the Derivative Lawsuits’ allegations

24 that the Individual Defendants (1) caused RVVYL to make a series of false statements to

25 the investing public and (2) caused RYVYL to overpay for repurchases of its own stock

26 while the price was artificially inflated due to the alleged false statements. ECF No. 26-1,

27 at 8-9.

28 The reforms further mandate that RYVYL establish and maintain training programs

1 that include “coverage of risk assessment and compliance, RYVYL’s Code of Ethics,

2 Related Party Transactions Policy, Clawback Policy . . . Whistleblower Policy . . . and all

3 other manuals or policies established by RYVYL concerning legal or ethical standards of

4 conduct.” ECF No. 18-1, at 11. These trainings will be mandatory for all directors, officers,

5 and employees and will occur on an annual basis. Id. at 10. The Court finds that this

6 proposed training program is substantial, directly addresses the alleged corporate

7 misconduct, and would provide a considerable benefit to RYVYL.

8 The reforms’ benefits are bolstered by the fact that RYVYL will implement and

9 maintain the reforms for three years following the effective date of the settlement. ECF No.

10 18-1, at 4. This multi-year implementation period will be beneficial to the company. See

11 Chenoy v. Lyft, Inc., No. 20-CV-09257-HSG, 2025 WL 948065, at *5 (N.D. Cal. Mar. 28,

12 2025) (“Because the Settlement Agreement fixes these reforms in place for a three-year

13 period, the reforms may well engender some lasting trust in [the company’s] safety and

14 corporate governance, yielding financial benefits for [the company]”).

15 The Court does note that among the listed reforms is the “expan[sion] and

16 document[ation] of the duties” of a new Vice President Legal. ECF No. 19-1, at 7. The VP

17 Legal has already been hired by RYVYL, and the Reforms note that the VP Legal may

18 already be tasked with several of the responsibilities outlined therein. See ECF No. 18-2,

19 at 6. Thus, this element of the Reforms would not persuade the court of the value of the

20 settlement. See, e.g., In re Pinterest Derivative Litig., No. C 20-08331-WHA, 2022 WL

21 2079712, at *3 (N.D. Cal. June 9, 2022) (critical of the fact that “a fair number of the

22 reforms were already in place as a result of the corporation’s own actions addressing the

23 [underlying action’s allegations]”). However, the additional Reforms are sufficiently novel

24 and beneficial to RYVYL that, overall, the Court finds that the Settlement is in RYVYL’s

25 best interest. Thus, the benefits to RYVYL—the most important factor in evaluating the

26 fairness of a derivative action settlement—weigh in favor of approving the Settlement. See

27 In re Pinterest Derivative Litig., 2022 WL 484961, *3.

28 2. Non-Collusive, Arm’s-Length Negotiations

1 The Parties assert that the Settlement “is the result of several months of arm’s-length

2 negotiations among experienced, well-informed counsel following their substantial

3 investigation of the claims, defenses, and remedial measures.” ECF No. 26-1, at 12.

4 In evaluating the fairness of a derivative action settlement, courts must ensure that a

5 settlement agreement “is not the product of fraud or overreaching by, or collusion between,

6 the negotiating parties.” In re Hewlett-Packard, 2015 WL 1153864, at *3 (quoting In re

7 NVIDIA Corp. Derivative Litig., 2008 WL 5382544, at *2). An agreement reached in good

8 faith after well-informed, arms-length negotiation is “entitled to a presumption of fairness.”

9 In re Am. Apparel, Inc. S’holder Litig., No. CV 10–06352 MMM (JCGX), 2014 WL

10 10212865, at *8 (C.D. Cal. July 28, 2014). Indeed, the Ninth Circuit “put[s] a good deal of

11 stock in the product of an arms-length, non-collusive, negotiated resolution.” Rodriguez v.

12 W. Publ’g Corp., 563 F.3d 948, 965 (9th Cir. 2009).

13 The Court finds the Parties’ negotiation process to be fair. Parties were represented

14 by counsel who understood the strengths and weaknesses of the claims and defenses in the

15 Derivative Lawsuits. ECF No. 26-1, at 12-13. Indeed, Plaintiffs’ counsel conducted

16 extensive investigation and analysis of the underlying facts, including, among other things,

17 (1) reviewing and analyzing all RYVYL press releases, public statements, and SEC filings;

18 (2) reviewing and analyzing securities analysts’ reports about RYVYL; (3) reviewing and

19 analyzing the pleadings in the Securities Class Action; (4) researching the applicable law

20 with respect to the claims alleged and the potential defenses; (5) researching RYVYL’s

21 corporate governance structure; and (6) preparing multiple versions of comprehensive

22 written settlement demands. ECF No. 18, at 7. The settlement negotiations also occurred

23 over the course of several months. Id., at 6.

24 The Court also finds the Parties’ negotiations to be non-collusive. Plaintiffs’ and

25 Defendants’ counsel negotiated over a prolonged period, and only after the Parties reached

26 an agreement in principle on the material terms of the settlement did the Parties engage in

27 separate negotiations regarding attorneys’ fees. ECF No. 18, at 6, ECF No. 19-1, at 18.

28 This favors a finding of no collusion. See Moore v. Verb Tech. Co., Inc., 2021 WL

1 11732976, at *5 (finding “no signs of collusion” because “[t]he parties did not begin to

2 negotiate the attorneys’ fees and expenses to be paid to Plaintiff's Counsel until after they

3 reached an agreement on the [corporate governance reforms].”).

4 Further, while the parties did not utilize the services of a mediator in finalizing the

5 Settlement now before the Court, the Court notes that defense counsel representing

6 RYVYL in this derivative settlement also did so in the related Securities Class Action

7 settlement approved by this Court on December 19, 2025. See Cullen v. RYVYL Inc. fka

8 GreenBox POS, Inc., et al., No. 3:23-CV-00185-GPC-SBC, 2025 WL 3731036 (S.D. Cal.

9 Dec. 19, 2025). As part of the class action settlement process, the parties engaged in

10 extensive negotiations overseen by a professional mediator. Id. at *6. Such arm’s-length

11 negotiations further assure the Court that that the Settlement now before it was negotiated

12 fairly and in good faith.

13 The Court finds that the Settlement is the result of a substantive, non-collusive

14 negotiation process. Thus, this factor weighs in favor of finding that the Settlement is fair,

15 reasonable, and adequate.

16 3. Risks and Costs of Further Litigation

17 The Parties emphasize that the settlement eliminates the risks and costs of ongoing

18 litigation, particularly given the risk of no recovery after years of litigation. ECF No. 26-

19 2, at 19.

20 When considering a derivative settlement, a court “must balance the continuing risks

21 of litigation (including the strengths and weaknesses of the Plaintiffs’ case), with the

22 benefits afforded . . . and the immediacy and certainty of a substantial recovery.” Velazquez

23 v. Int’l Marine & Indus. Applicators, LLC, No. 16CV494-MMA (NLS), 2018 WL 828199,

24 at *4 (S.D. Cal. Feb. 9, 2018). Further, “[c]ourts agree that derivative actions are

25 particularly complex and ‘rarely successful.’” Arnaud van der Gracht de Rommerswael on

26 Behalf of Puma Biotechnology, Inc. v. Auerbach, No. SACV1800236AGJCGX, 2019 WL

27 7753447, at *4 (C.D. Cal. Jan. 7, 2019) (quoting In re Pac. Enters. Sec. Litig., 47 F.3d 373,

28 378 (9th Cir. 1995)). “The doctrine of demand futility, the business judgment rule, and the

1 generally uncertain prospect of establishing a breach of fiduciary duties combine to make

2 shareholder derivative suits an infamously uphill battle for plaintiffs.” In re Fab Universal

3 Corp. S’holder Derivative Litig., 148 F. Supp. 3d 277, 281–82 (S.D.N.Y. 2015).

4 Regardless of their merit, Plaintiffs’ claims would be difficult and costly to sustain

5 if this litigation were to proceed. “From the outset, Plaintiffs faced risks that the Derivative

6 Lawsuits might not have withstood challenges at the pleading stage, especially given Rule

7 23.1’s heightened standards for pleading demand futility and demand refusal.” ECF No.

8 26-1, at 17 (internal quotation marks and citation omitted). Further, the Parties agree that,

9 if Plaintiffs succeeded at the pleading stage, they “would have faced the high costs

10 associated with lengthy and complex litigation, including voluminous discovery and

11 depositions.” Id. (internal quotation marks and citation omitted); see also Auerbach, 2019

12 WL 7753447, at *4 (approving derivative action settlement in part by noting the potential

13 cost of discovery where biotech drug company was sued over allegedly false and

14 misleading statements about drug product’s safety and efficacy). These high risks and costs

15 contrast with the settlement’s certainty and immediacy. In short, “[a] number of risks are

16 posed by continued litigation, while settlement assures broad corporate reform.” In re Fab

17 Universal Corp. S’holder Derivative Litig., 148 F. Supp. 3d at 282.

18 Accordingly, the substantial risks of prolonged and costly litigation weigh in favor

19 of approval of the Settlement.

20 4. Reaction of Shareholders

21 The deadline for shareholders to submit objections to the Settlement was December

22 26, 2025. See ECF No. 23, at 19. No shareholder objected. See ECF No. 29, at 3. “[T]he

23 absence of a large number of objections to a proposed class action settlement raises a strong

24 presumption that the terms of a proposed class settlement action are favorable to the class

25 members.” Nat'l Rural Telecomms. Coop. v. DIRECTV, Inc., 221 F.R.D. 523, 529 (C.D.

26 Cal. 2004); see also Churchill Vill., LLC v. Gen. Elec., 361 F.3d 566, 577 (9th Cir.

27 2004) (holding that approval of a settlement that received 45 objections (0.05%) and 500

28 opt-outs (0.56%) out of 90,000 class members was proper). “Courts reviewing settlements

1 of shareholder derivative suits have applied the same presumption.” In re Wells Fargo &

2 Co. S'holder Derivative Litig., 445 F. Supp. 3d at 518 (citing In re Ceradyne, Inc., No. SA-

3 CV-06-919-JVS-PJWX, 2009 WL 10671494, at *5 (C.D. Cal. June 9, 2009)). Indeed,

4 “[t]hat presumption is further enhanced where ‘not one sophisticated institutional investor

5 objected to the Proposed Settlement.’” Id. (quoting In re Facebook, Inc., IPO Sec. &

6 Derivative Litig., 343 F. Supp. 3d 394, 410 (S.D.N.Y. 2018)).

7 Accordingly, the shareholders’ reaction to the settlement—as evidenced by the lack

8 of objections raised—further supports a finding that the Settlement is fair, reasonable, and

9 adequate.

10 In sum, given the Settlement’s benefits to RYVYL, the Parties’ non-collusive

11 negotiation, the uncertainty and potentially high cost of further litigation, and the reaction

12 of the shareholders, the Court finds the Settlement to be fair, reasonable, and adequate, and

13 GRANTS final approval of the Settlement.

14 II. Plaintiffs’ Unopposed Motion for Attorneys’ Fees and Service Awards

15 Together with its motion for final approval, Plaintiffs’ counsel has filed an

16 unopposed motion for an order approving the award of attorneys’ fees and expenses

17 outlined in the Settlement. ECF No. 28.

18 A. Plaintiffs’ Counsel’s Fees and Expenses

19 Plaintiffs may be awarded attorneys’ fees in derivative suits if the resolution of the

20 claim confers a “substantial benefit” on the corporation. See Mills v. Elec. Auto-Lite Co.,

21 396 U.S. 375, 393-95 (1970). “Courts have consistently approved attorneys’ fees and

22 expenses in shareholder actions where the plaintiffs’ efforts resulted in corporate

23 governance reforms but no monetary relief.” In re Taronis Techs., Inc. S'holder Derivative

24 Litig., No. CV-19-04547-PHX-GMS, 2021 WL 842137, at *3 (D. Ariz. Mar. 5, 2021)

25 (citing In re Rambus Inc. Derivative Litig., No. C 06-3513 JF (HRL), 2009 WL 166689, at

26 *3 (N.D. Cal. Jan. 20, 2009)).

27 In determining the appropriate measure of attorney’s fees, the court must exercise

28 its discretion to achieve a “reasonable result.” In re Bluetooth Headset Prods. Liab. Litig.,

1 654 F.3d 935, 942 (9th Cir. 2011). The lodestar method of awarding attorneys’ fees “is

2 especially appropriate . . . ‘where the relief sought—and obtained—is . . . primarily

3 injunctive.’” Kim v. Allison, 8 F.4th 1170, 1181 (9th Cir. 2021) (quoting In re Bluetooth

4 Headset Prods. Liab., 654 F.3d 935, 941 (9th Cir. 2011)); see also Osher v. SCA Realty I,

5 Inc., 945 F. Supp. 298, 307 (D.D.C. 1996) (“Courts generally regard the lodestar method,

6 which uses the number of hours reasonably expended, as the best approach in cases where

7 the nature of the settlement evades the precise evaluation needed for the percentage of

8 recovery method.” (internal quotation marks and citation omitted)). The lodestar amount

9 is determined by multiplying the number of hours reasonably spent on the litigation by a

10 reasonable hourly rate. McCown v. City of Fontana, 565 F.3d 1097, 1102 (9th Cir. 2009).

11 In this case, the Parties have agreed on an attorneys’ fees and expenses award of

12 $200,000, which is comprised of $25,000 in cash and $175,000 in Settlement Shares

13 (together, the “Fee and Expense Amount”). ECF No. 18, at 16-17. The term Settlement

14 Shares refers to the number of freely tradable shares of RYVYL common stock equal to

15 $175,000 in value based on the average daily adjusted closing price (as determined by

16 Bloomberg) over the ten trading days preceding the date of the Court’s final approval of

17 the Settlement. ECF No. 27, at 9 n.4. The award in this case will be allocated between

18 Plaintiffs’ counsel in all three of the Derivative Lawsuits, including the consolidated

19 derivative actions before this Court, as well as the Nevada State Action.

20 At the preliminary approval hearing, the Court instructed Plaintiffs’ counsel to

21 provide the Court with an account of hours billed in this case to aid the Court in its

22 consideration of the reasonableness of the $200,000 award. Counsel has done so through

23 declarations from Timothy Brown—managing partner of The Brown Law Firm P.C. and

24 Co-Lead Counsel in the consolidated shareholder derivative action before this Court, ECF

25 No. 28-2—and Timothy J. Macfall—a partner at Rigrodsky Law, P.A. and Plaintiff’s

26 counsel of record in the Nevada State Action, ECF No. 28-4.

27 The lodestar figure from the Brown Law Fim, P.C. is $199,262.50 for 232.1 hours

28 of work, along with expenses totaling $5,396.29. ECF No. 27, ¶¶ 52, 54. Hourly rates

1 ranged from $375 for law clerks to $1,075 for the managing partner. Id. ¶ 52. Costs

2 included court fees, legal research, mileage reimbursement, service of process, transcript

3 fees, and travel. Id. ¶ 54. The lodestar figure for counsel in the Nevada State Action—

4 Rigrodsky Law, P.A.—is $103,210.00 for 129.75 hours of work, along with $1,958.90 in

5 expenses. ECF No. 27-3, ¶¶ 7, 9. Hourly rates ranged from $200 for a paralegal to $1,000

6 for a partner. Id. ¶ 7. Costs included court filing fees and online legal research. Id. ¶ 9.

7 Thus, the total lodestar figure for hours worked is $302,472.50, and the total expenses are

8 $7,355.19.

9 As an initial matter, the Court finds that the costs incurred in pursuing this action—

10 totaling $7,355.19—were justifiably incurred in procurement of the settlement and typical

11 for similar litigation. See In re Immune Response Sec. Litig., 497 F. Supp. 2d 1166, 1177-

12 78 (S.D. Cal. 2007) (approving counsel’s request for reimbursement “for 1) meals, hotels,

13 and transportation; 2) photocopies; 3) postage, telephone, and fax; 4) filing fees; 5)

14 messenger and overnight delivery; 6) online legal research; 7) class action notices; 8)

15 experts, consultants, and investigators; and 9) mediation fees”).

16 The Court will now turn its attention to the fee award. If the Court were to grant the

17 agreed-upon $200,000 award, the net attorneys’ fees award—after subtracting costs and

18 service awards—would be $191,144.81. ECF No. 27, ¶ 49. This figure represents 63

19 percent of the total lodestar calculation, or a negative multiplier of 0.63. A lodestar

20 “multiplier of less than one . . . suggests that the negotiated fee award is a reasonable and

21 fair valuation of the services rendered to the class.” Chun–Hoon v. McKee Foods Corp.,

22 716 F. Supp. 2d 848, 854 (N.D. Cal. 2010) (requested fee award was not unreasonable

23 when lodestar cross-check revealed a multiplier of 0.59); see also See Mobile Emergency

24 Hous. Corp. v. HP Inc., No. 5:20-CV-09157-SVK, 2025 WL 844412, at *2 (N.D. Cal. Mar.

25 18, 2025) (“Moreover, the negative lodestar multiplier demonstrates the reasonableness of

26 the requested attorneys' fees.”).

27 Further, the award in this case was the product of negotiations between experienced

28 counsel that occurred only after the Parties reached an agreement in principle on the

1 material terms of the Settlement. “[G]reat, and potentially dispositive, weight should be

2 given to a fee amount not to be paid from a common fund negotiated at arm’s length

3 between sophisticated counsel after the substantive terms of a settlement have been

4 agreed.” Allred on behalf of Aclaris Therapeutics, Inc. v. Walker, No. 19-CV-10641 (LJL),

5 2021 WL 5847405, at *5 (S.D.N.Y. Dec. 9, 2021); see also In re OSI Sys., Inc. Derivative

6 Litig., No. CV-14-2910-MWF-MRWX, 2017 WL 5642304, at *5 (C.D. Cal. May 2, 2017)

7 (“The parties’ separately-negotiated attorneys' fees arrangement warrants significant

8 deference.”).

9 Lastly, the Notice of Settlement distributed after preliminary approval apprised

10 shareholders of the terms of the Settlement, including the agreed-upon $200,000 award of

11 attorneys’ fees and expenses. ECF No. 27, ¶ 10. Yet, no shareholder objected to the

12 proposed award. See ECF No. 29, at 3. “As with the Settlement itself, the lack of objections

13 from institutional investors ‘who presumably had the means, the motive, and the

14 sophistication to raise objections’ weighs in favor of approval of the fee request.” In re

15 Wells Fargo & Co. S'holder Derivative Litig., 445 F. Supp. 3d 508, 533 (N.D. Cal.

16 2020), aff'd, 845 F. App'x 563 (9th Cir. 2021) (quoting In re Bisys Sec. Litig., No. 04-CV-

17 3840-JSR, 2007 WL 2049726, at *1 (S.D.N.Y. July 16, 2007)).

18 Considering (1) the negative multiplier, (2) the lack of objections, (3) the fact that

19 the fee award will not be taken from a common fund, and (4) the fact that the award was

20 negotiated by experienced counsel only after reaching an agreement on the terms of

21 Settlement, the Court finds the agreed-upon attorneys’ fee award to be reasonable.

22 B. Shareholders’ Service Awards

23 The Parties have also agreed that Plaintiffs’ counsel may apply to the Court for

24 service awards of up to $500 for each named Plaintiff. The awards are to be paid from the

25 Fee and Expense Amount in recognition of Plaintiffs’ participation and effort in the

26 prosecution of the Derivative Lawsuits. ECF No. 18, at 19-20. Plaintiffs’ counsel now

27 seeks approval of $500 service awards for each of the three Plaintiffs in the Derivative

28 Lawsuits.

1 “Derivative plaintiffs may . . . merit compensation for work done on behalf of the

2 [shareholders].” Chenoy v. Lyft, Inc., No. 20-CV-09257-HSG, 2025 WL 948065, at *7

3 (N.D. Cal. Mar. 28, 2025) (quoting In re Wells Fargo & Co. Sharehold Derivative Litig.,

4 2019 WL 13020734, at *8) (alterations in original). “An incentive payment to come from

5 the attorneys’ fees awarded to plaintiff's counsel need not be subject to intensive scrutiny,

6 as the interests of the corporation, the public, and the defendants are not directly affected.”

7 In re OSI Sys., Inc. Derivative Lit., 2017 WL 5642304, at *5.

8 Here, each Plaintiff filed a separate derivative action which was then consolidated

9 into the present litigation or included within the present Settlement negotiations. As such,

10 the shareholder Plaintiffs actively participated in the litigation and undertook certain

11 responsibilities and risks that accompany publicly litigating such a suit. Further, the service

12 award amount of $500 is well below the “presumptively reasonable” amount of $5,000 for

13 such awards. In re Wells Fargo & Co. Sharehold Derivative Litig., 445 F. Supp. 3d at 534

14 (citing cases). Accordingly, the Court concludes that the requested service awards are

15 reasonable and approves the payment of a $500 service award to each of the three named

16 Plaintiffs.

17 Because the requested attorneys’ fees and expenses, as well as the service awards,

18 are reasonable, the Court approves the agreed-upon fee and expense award of $200,000,

19 including a total of $1,500 in service awards for the three named shareholder Plaintiffs.

20 CONCLUSION

21 For the foregoing reasons, the Court GRANTS the joint motion for final approval

22 of the Settlement, ECF No. 26. The settlement shall be consummated in accordance with

23 its terms, and the Court shall retain jurisdiction as described therein. ECF No. 18 at 25.

24 The Court also GRANTS Plaintiffs’ unopposed motion for approval of the award of

25 attorneys’ fees, expenses, and service awards. ECF No. 28. The Court awards Plaintiffs’

26 counsel a total of $200,000 in costs and fees—to be comprised of $25,000 in cash and

27 $175,000 in Settlement Shares—which includes an approved service award of $500 to each

28 of the three named Plaintiffs.

1 IT IS SO ORDERED.

2 ||Dated: January 13, 2026 Casto 0h

3 Hon. Gonzalo P. Curiel

4 United States District Judge

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