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Stanford University Law School - Securities Class Action Clearinghouse
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UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
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DAVID STEINBERG, on behalf of :
himself and all others :
similarly situated, : CIVIL ACTION NO. 96CV-633
:
Plaintiff, :
:
- against - : CLASS ACTION COMPLAINT
:
CEPHALON INC., FRANK BALDINO, :
JR., and BRUCE A. PEACOCK, :
: TRIAL BY JURY
Defendants. :
:
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INTRODUCTION
Plaintiff, for his class action complaint, alleges upon
information and belief (said information and belief being based, in
part, upon the investigation conducted by and through his
undersigned attorneys), except as to those paragraphs relating to
the plaintiff, his purchase of Cephalon Inc. ("Cephalon" or the
"Company") common stock, and his suitability to serve as a class
representative, which are alleged upon personal knowledge, as
follows:
JURISDICTION AND VENUE
1. This Court has subject-matter jurisdiction over the
action pursuant to Section 27 of the Securities Exchange Act of
1934 (the "Exchange Act"), 15 U.S.C. § 78aa; and 28 U.S.C. § 1331
(federal question).
2. Venue is proper in this judicial district pursuant
to Section 27 of the Exchange Act because defendant Cephalon has
its corporate headquarters and transacts substantial business in
the district, and because many of the acts, transactions, and
occurrences alleged herein, including the preparation, issuance and
dissemination to the investing public of materially false and
misleading information, occurred, at least in part, in this
district.
3. In connection with the acts alleged in this
Complaint, defendants, directly or indirectly, used the means and
instrumentalities of interstate commerce, including the mails,
telephone communications, and the facilities of the national
securities exchanges.
NATURE OF ACTION
4. This class action is brought on behalf of all
persons or entities who purchased the common stock of Cephalon
during the Class Period defined below, to recover damages caused to
plaintiff and the Class by defendants' violations of the federal
securities laws.
5. During the Class Period, defendants engaged in a
course of conduct that was designed to, and did:
a. deceive the investing public, including
plaintiff and other members of the Class concerning trial methods
and results of the Company's new drug Myotrophin;
b. artificially inflate the market price of
Cephalon's common stock during the Class Period; and
c. cause plaintiff and other members of the Class
to purchase Cephalon's common stock at inflated prices.
2
In furtherance, of this plan and course of conduct, defendants took
the actions alleged herein.
THE PARTIES
6. Plaintiff David Steinberg purchased 50 shares of
Cephalon common stock on June 15, 1995, during the Class Period
alleged herein.
7. Defendant Cephalon is a corporation organized and
existing under and by virtue of the laws of the State of Delaware.
Its principal offices and corporate headquarters are located at 145
Brandywine Parkway, West Chester, Pennsylvania. Defendant Cephalon
discovers, develops, and markets products to treat meurological [sic]
disorders and head and spinal injuries.
8. Defendant Frank Baldino, Jr ("Baldino") is, and at
all relevant times was, the President, Chief Executive Officer, and
a director of the Company.
9. Defendant Bruce A. Peacock ("Peacock") is, and at
all relevant times was, the Chief Operating Officer and a director
of the Company.
10. Defendants Baldino and Peacock (the "Individual
Defendants"), by reason of their direct and substantial management
positions and responsibilities during the time relevant to this
Complaint were "controlling persons" of Cephalon within the meaning
of Section 20 of the Exchange Act, and had the power and influence
to control Cephalon, and exercised such control, to cause the
Company to engage in the violations and improper practices
complained of herein. The Individual Defendants, because of their
3
positions as officers and directors of Cephalon, had access to
material adverse non-public information about the clinical testing
methods used by Cephalon and the results of such tests and acted to
conceal and misrepresent such material information in violation of
their duties and responsibilities under the federal securities
laws.
CLASS ACTION ALLEGATIONS
11. Plaintiff brings this action as a class action
pursuant to Federal Rule of Civil Procedure 23 on behalf of a class
(the "Class") consisting of all persons and entities who purchased
Cephalon common stock at any time from June 1, 1995, through and
including January 19, 1996 (the "Class Period"), and who were
damaged thereby. Excluded from the Class are defendants, their
subsidiaries and affiliates, and members of the immediate family of
each of the Individual Defendants.
12. During the Class Period, plaintiff and the other
members of the Class purchased shares of Cephalon common stock in
the open market without knowledge of the misconduct of defendants
alleged in this Complaint and suffered damages as a result.
Plaintiff and each member of the Class relied directly or
indirectly upon defendants' public reports, press releases, and
other public statements, as more fully described below, and/or upon
the integrity of the market for Cephalon common stock.
13. The Class is so numerous that joinder of all Class
members is impracticable. While the exact number of Class members
is unknown to plaintiff at this time and can only be ascertained
4
from the records maintained by Cephalon or its agents, as of
November 9, 1995, there were more than 19,000,000 shares of
Cephalon common stock outstanding held by 364 shareholders of
record throughout the United States.
14. Shares of Cephalon common stock are actively traded
in an open and efficient market on through the National Association
of Stock Dealers Automatic Quotation system ("NASDAQ").
15. Plaintiff's claims are typical of the claims of the
members of the Class, since all members of the Class purchased
shares of Cephalon common stock during the Class Period and
sustained damages arising out of defendants' wrongful conduct in
violation of federal securities laws as alleged herein.
16. Plaintiff will fairly and adequately protect the
interests of the members of the Class. Plaintiff has retained
counsel competent and experienced in class action and securities
litigation and plaintiff has no interests antagonistic to or in
conflict with the other members of the Class.
17. A class action is superior to other available
methods for the fair and efficient adjudication of this
controversy. Joinder of all Class members is impracticable. The
likelihood of individual Class members prosecuting separate claims
is remote. Since the damages suffered by individual Class members
may be relatively small, the expense and burden of individual
litigation makes it impossible for Class members individually to
seek redress for the wrongs done to them. It is desirable for all
concerned to concentrate this litigation in this particular forum.
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No unusual difficulties are likely to be encountered in the
management of this class action.
18. There are questions of law and fact common to the
members of the Class which predominate over any questions affecting
any individual members. These common questions of law and fact
include, among others:
a. whether defendants violated Sections 10(b) and
20(a) of the Exchange Act and SEC Rule 10b-5;
b. whether defendants participated in and/or
conspired in the common course of conduct complained of herein;
c. whether documents, releases, reports, and
statements disseminated to the investing public during the Class
Period omitted to state or misrepresented material facts about the
business prospects and financial outlook of Cephalon;
d. whether defendants acted with knowledge or with
reckless disregard for the truth in misrepresenting and/or omitting
to state material facts about the business prospects of Cephalon;
e. whether, during the Class Period, the market
price of Cephalon's common stock was artificially inflated due to
the material misrepresentations and/or non-disclosures complained
of herein; and
f. whether the members of the Class have sustained
damages, and, if so, the proper measure thereof.
19. Plaintiff will rely, in part, upon the presumption
of reliance established by the fraud-on-the-market doctrine, in
that:
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a. defendants made public misrepresentations
during the Class Period, as alleged in this Complaint;
b. the misrepresentations were material;
c. shares of Cephalon common stock were traded on
a developed national stock exchange, namely the National Market
System which is an efficient market within the meaning of that term
in the context used in this Complaint; and
d. plaintiff and the other members of the Class
purchased their Cephalon shares between the time defendants made
the misrepresentations and the time the truth was at least
partially revealed, without knowledge of the falsity of the
misrepresentations.
20. Based upon the foregoing, plaintiff and the other
members of the Class are entitled to a presumption of reliance upon
the integrity of the market. Similarly, plaintiff and the other
members of the Class are also entitled to a presumption of reliance
with respect to the omissions of material fact alleged in this
Complaint.
SUBSTANTIVE ALLEGATIONS
21. Cephalon has developed an experimental drug,
Myotrophin, for the treatment of amyotrophic lateral sclerosis
("ALS") or Lou Gehrig's disease, named after the famous New York
Yankee baseball player who died of the disease. Lou Gehrig's
disease is a condition that leads to the degeneration of a
patient's central nervous system, resulting in muscle atrophy and
eventual death three to five years after the onset of the disorder.
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Myotrophin is a synthetic form of a natural hormone that scientists
have been aware of for decades, which purportedly causes the
nervous system to sprout new nerves, helps them survive, and
strengthens the nerve/muscle connection.
22. Cephalon developed Myotrophin in a joint venture
with Chiron Corp. ("Chiron"), through a partnership called Cephalon
Clinical Partners, L.P. ("CCP").
False Information About The Phase III Studies
23. On June 10, 1995, Cephalon presented the results of
a Phase III clinical study of Myotrophin on 266 patients with ALS
at eight medical centers in the United States and Canada at a
session of the World Federation of Neurology Committee on Motor
Neuron Diseases in Talloires, France.
24. On June 12, 1995, the Company, through its senior
vice president, Michael F. Murphy, M.D., Ph.D. ("Murphy"),
announced at a press conference that the "study demonstrated that
[Myotrophin] had highly statistically significant effects on
clinically important measurements for patients with ALS, for whom
no approved therapies currently exist."
25. According to an article published in the New York
Times on June 13, 1995, the Company claimed that Myotrophin slowed
the advance of ALS by 25 percent.
26. According to an article published by Information
Access Company on June 19, 1995, defendant Baldino called the
results of the study "spectacular."
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27. In a press release issued on the same date as the
press conference, June 12, 1995, the Company also announced that
Myotrophin was well-tolerated by the patients in the Phase III
clinical study.
28. In response to criticisms of the methodology of the
Phase III study made by Leon Charash, M.D., Chairman of the
Muscular Distrophy Association's medical advisory committee,
defendant Baldino affirmatively represented that the study was
performed in accordance with accepted guidelines.
29. The comments made by the Company and defendant
Baldino in connection with the announcement of the Phase III study
results were intended to and did convey to the investing public the
impression that the Phase III clinical study and the announced
positive results thereof were reliable and indicative of the
commercial viability of the drug.
30. On June 13, 1995, Bloomberg Business News quoted
defendant Baldino as stating, "It's good news for a lot of people.
The robustness of the effect here was very significant and dose-
related." Defendant Baldino's comments were intended to and did
reinforce the confidence of the invensting [sic] public in the announced
results of the Phase III study.
31. Immediately following the press conference, shares
of Cephalon stock nearly doubled in price, leaping from $10.75 per
share to $18.375 per share, with more than 6 million shares traded
on June 12, 1995.
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32. On the basis of the announcement of the results of
the Phase III clinical study, the price of Cephalon common stock
began to trade significantly higher than an index of other
biotechnology company stocks also traded on the NASDAQ on June 12,
1995.
33. In an industry journal, The Genesis Report/RX, the
Company's director of scientific affairs, John Farah, Jr., Ph.D.
("Farah"), announced that in a 9-month portion of the trial, 266
patients with the disease who received 0.05 to 0.10 mg/kg of the
drug per day showed statistically significant improvement on the
Appel ALS rating scale compared to patients receiving a placebo.
The Appel ALS scale is a neuromuscular scale evaluating criteria
such as muscle strength and function, speech, respiration and
swallowing.
34. Significantly, Farah stated that prolonging life
expectancy was not the "endpoint in the trial," but added:
we are doing post hoc analysis for the
patients we follow, and it appears that there
are fewer dying at fixed time points who
received either the high or the low dose
compared to a placebo. [Emphasis added.]
35. Defendant Baldino was quoted on June 19, 1995, in an
industry journal, Biotechnology Newswatch, as stating:
I'm absolutely stunned with the level of
consistent dose relatedness across all
measures, and more stunned as to the clinical
relevance.
36. Baldino added "that the data are 'so robust and so
statistically significant' that no subgroup analysis was required."
The Biotechnology Newswatch quoted Baldino as stating that in light
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of these findings the FDA should "give Myotrophin an expedited
review."
37. With the price of the stock bolstered by the
announcement of the results of the Phase III clinical study, on
June 22, 1995, and while in the possession of material undisclosed
adverse information as alleged below, defendant Baldino sold 75,613
shares, or 24 percent of his direct holding, of Cephalon stock on
the open market for more than $1.4 million.
38. With the price of the stock bolstered by the
announcement of the results of the Phase III clinical study and
trading at approximately $30 per share (or nearly three times the
price per share prior to the June 12, 1995, press conference, on
August 7, 1995, Cephalon sold an additional 3.9 million shares of
common stock in a secondary offering, raising more than $84 million
and effectively recovering the entire $84.2 million in losses since
the Company was created in 1987.
39. With the price of the stock bolstered by the
announcement of the results of the Phase III clinical study, on
August 9, 1995, while in the possession of material undisclosed
adverse information R. Edward Branson ("Branson"), vice president
of Cephalon, sold 5,000 shares, or his entire direct holding, of
Cephalon stock, which shares were acquired by the exercise of an
option on the same date, on the open market for a profit of
$101,250.
40. On October 23, 1995, Cephalon issued a press release
announcing that it had filed a treatment investigational new drug
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application ("IND") with the U.S. Food and Drug Administration
("FDA") for Myotrophin.
41. On October 31, 1995, the Company issued a press
release announcing the results of a Phase III clinical study of
Myotrophin conducted at eight medical centers in six European
countries. The press release stated:
After an evaluation period of up to three
months, eligible patients with ALS were
randomized to receive placebo or 0.10
milligrams per kilogram per day of Mytrophin [sic]
by subcutaneous injection for up to nine
months. Patient demographics and disease
characteristics were consistent with patients
who participated in the North American study.
As a group, patients in this study who
received Mytrophin [sic] showed approximately 22
percent less teterioration [sic] than patients
receiving placebo, based upon their scores on
the Appel ALS Rating Scale in analyses of both
functional severity of disease and disease
progression. ... These findings were stat-
istically significant.
...
Mytrophin [sic] was well-tolerated. There were no
statistically significant differences between
drug and placebo groups for reported adverse
events.
42. The Dow Jones News Service reported on October 31,
1995, quoted defendant Baldino: "Not only did we win on the primary
endpoints, but on all measures of functionality."
43. Defendant Baldino went to great lengths to tie the
earlier North American trial together with the European trial to
indicate a consistency in results. Baldino stated, "what's going
to come across" from the two studies, "is the remarkable
consistency." "That's what doctors want to see," he said.
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44. Cephalon was quoted by the Dow Jones News Service on
October 31, 1995, as stating: "[T]he drug appears to have an effect
on survival."
45. On November 6, 1995 the Marketletter reported that
Cephalon Vice President of clinical research Michael Murphy told
the Marketletter that:
The European trial of Myotrophin had
successfully demonstrated the efficacy of the
drug in delaying progression and severity of
ALS, which was comparable to the earlier North
American findings (Marketletter June 19), and
that with these data the companies will be
looking to file for marketing approval in the
USA in the next two months and soon thereafter
in Europe, with the hope of having the drug on
sale by next summer.
The Truth About The Phase III Studies
46. On January 19, 1996, Cephalon announced that the FDA
raised concerns about the Phase III clinical study of Myotrophin.
47. On January 22, 1996, The Wall Street Journal
reported that Cephalon had announced that the FDA had refused "to
let it expand patient tests of the new drug Myotrophin." The Wall
Street Journal reported that:
The FDA apparently expressed concerns about
the trial data, which showed that in a trial
in Europe, patients using the drug had died at
about twice the rate of patients taking a
placebo. That death rate was much higher than
the rate in an earlier North American test.
48. Industry analysts stated that the Company's trial
methods utilized in both the North American and European trials
were faulty, as the trials were constructed to exclude reporting
many of the deaths of patients involved. The tests only indicated
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the slowing of Lou Gehrig's disease rather than looking at the
mortality rate of those patients involved. The Company arrived at
these skewed results by removing patients who deteriorated beyond
a certain level from the test group. Patients removed from the
test group who subsequently died were not included in computing the
test group's overall mortality rate.
49. The Company never revealed what would undoubtedly
have been deemed the most significant factor by both the general
public and the investing public i.e. the mortality statistics of
those tested with Myotrophin. In fact a spokesman for the Company
Jason Rubin was quoted in Bioworld on November 1, 1995 as stating
that, "[t]here was no statistically significant difference in the
deaths that occurred in the placebo and treatment groups." On the
contrary, as was revealed on January 19, 1995, the death rate in
the Myotrophin group was twice that of the placebo group.
50. Significantly, Cephalon's rivals do not use the
Company's drug testing methods. As The Wall Street Journal
reported in its article of January 22, 1996, Cephalon's chief
competitor, Rhone Poulenc Rorer Inc. ("Rhone Poulenc") like
Cephalon removed those patients who deteriorated beyond a certain
level from its test group. However Rhone Poulenc, unlike Cephalon,
did count those patients removed from their test group who
subsequently died when computing mortality rates for its rival drug
Rilutek.
51. Cephalon's tests were patently constructed to
exclude the unfavorable mortality rate statistic by weeding out
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patients deteriorating below a certain level. The latter testing
method was never revealed to the investing public, nor were the
increased mortality rates of Myotrophin users.
52. Moreover, the Company's testing methods not only
misled investors as to the increased mortality rates of
Myotrophin's test patients but also the drug's general usefulness
as an agent to slow the progression of Lou Gehrig's disease. Even
if one was to view the utility of Myotrophin as limited to the
short term slowing of the symptoms of Lou Gehrig's disease and not
as a prolonger of life expectancy the increased mortality rate
statistic is still a valuable statistic as it may also indicate
other problems with the drug. As the Wall Street Journal reported:
The death rate data are crucial to evaluating
a drug's usefulness, said Julie Buring, a top
clinical-trial design expert and
epidemiologist at Harvard Medical School. She
said mortality data can suggest the presence
of an unseen side effect or show that a drug
slows a disease's symptoms at first, but
speeds them up later. "Without considering
the death rates, you'd have a very large gap
in knowledge that you'd want to fill," Dr.
Buring said.
53. Other industry experts cited additional flaws in
the Company's testing methods, such as the use of small trial
groups, over dependence on doctors subjective evaluations and the
use of an evaluation scale that is not generally accepted i.e. the
Appel ALS scale.
54. Plaintiff believes that, after the opportunity for
further investigation and discovery, the evidence will show that at
the time of the statements alleged above, defendants knew, or were
15
reckless in not knowing, and misrepresented or failed to disclose that:
a. the protocols for the Phase III clinical studies
in North America and Europe were inconsistent with other similar
studies conducted by the Company's competitors;
b. the results of the Phase III clinical studies in
North America and Europe were not statistically significant because
of the protocols used;
c. the results of the Phase III clinical studies in
North America and Europe did not demonstrate the efficacy of
Myotrophin; and
d. the mortality rate for participants in the Phase
III studies was greater for patients receiving Myotrophin than it
was for patients receiving placebo while the studies were ongoing,
because the protocol for the Phase III studies required the
elimination of patients who died during the studies and because
safety considerations required the Company to identify any
participants in the studies who died while participating in the
studies.
55. Plaintiff believes that, after the opportunity for
further investigation and discovery, the evidence will show that
defendants knew, or were reckless in not knowing, and
misrepresented or failed to disclose the truth about the Phase III
clinical studies of Myotrophin in North America and Europe prior to
the announcement of the results of the North American study on June
12, 1995, because:
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a. defendants knew or reasonably should have known
the details of the protocol for the Phase III studies prior to the
commencement of the studies;
b. defendants knew or reasonably should have known
the mortality rates for participants in the Phase III studies while
the studies were ongoing, because the protocol for the Phase III
studies required the elimination of patients who died during the
studies and because safety considerations required the Company to
identify any participants in the studies who died while
participating in the studies.
56. The Company misled the investing public as to the
meaning and significance of its test methods and results and
withheld material facts regarding the methodology of the test and
the increased mortality rates of Myotrophin users. These
misrepresentations and omissions prevented plaintiff and the other
members of the Class from accurately interpreting the announced
Phase III clinical study results and from assessing the risks
associated with the development of Myotrophin.
57. Based upon the announcement, the price of Cephalon
stock fell immediately by $15.50, or more than 40 percent, from
$35.875 to $20.375 per share. At the end of the day on January 19,
1996, Cephalon stock was trading at $23.375 on extraordinarily
heavy volume. Since January 19, 1996, the price of Cephalon stock
has continued to decline, returning to near the level of the index
of other biotechnology company stocks also traded on the NASDAQ.
COUNT I
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VIOLATION OF SECTION 10(b) OF THE EXCHANGE
ACT AND RULE 10b-5 AGAINST ALL DEFENDANTS
58. Plaintiff incorporates by reference and realleges
paragraphs 1 through 57 above as if set forth herein at length.
59. This claim is asserted by plaintiff and the Class
against all defendants and is based upon Section 10(b) of the 1934
Act, 15 U.S.C. § 78j(b) and Rule 10b-5 promulgated thereunder.
60. During the Class Period, the defendants,
individually and in concert, directly and indirectly, engaged and
participated in a continuous course of conduct and conspiracy to
conceal adverse material information regarding the trial methods
and results of Cephalon's new drug Myotrophin as specified herein.
Defendants recklessly employed devices, schemes, and artifices to
defraud and recklessly engaged in acts, practices, and a course of
conduct as herein alleged in an effort to maintain artificially
high market prices for the common stock of defendant Cephalon.
This included the formulation, making of and/or participating in
the making of untrue statements of material facts and the omission
to state material facts necessary in order to make the statements
made, in the light of the circumstances under which they were made,
not misleading.
61. Defendants' latter acts and practices operated as a
fraud and deceit upon plaintiff and other members of the Class by
creating expectations of optimism which were unrealistically
favorable in light of their knowledge or reckless disregard of the
truth concerning Myotrophin, its test methods and test results, in
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connection with the purchase of Cephalon's publicly traded
securities by plaintiff and the other members of the Class.
62. The market price of Cephalon's common stock was
artificially inflated throughout the Class Period by the Individual
Defendants' omissions and misrepresentations.
63. The statements particularized above were false and
misleading when made by the defendants, and/or in the name of
Cephalon. By making these statements, the defendants recklessly
created a false and misleading impression which artificially
inflated the market price of Cephalon's common stock throughout the
Class Period. The truth concerning the tests being conducted on
Myotrophin were recklessly disregarded by defendants, although the
truth concerning the drug remained concealed from the investing
public. Defendants, who were under a duty to make truthful and
complete disclosures, instead misrepresented or concealed material
facts throughout the Class Period.
64. During the Class Period, Cephalon made the
statements identified above which were materially false and
misleading in violation of Section 10(b) of the Exchange Act and
Rule 10b-5 thereunder. These statements were materially false and
misleading and omitted to state material facts necessary in order
to make the statements made, in light of the circumstances under
which they were made, not misleading.
65. With reckless disregard for the truth regarding
Myotrophin, the Individual Defendants caused Cephalon to make the
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statements containing misstatements and omissions of material fact
as alleged herein.
66. In direct or indirect reliance on the aforesaid
false and misleading statements, plaintiff and the other members of
the Class purchased Cephalon common stock during the Class Period
at artificially inflated prices and were damaged thereby.
67. Relying upon the integrity of the marketplace and
the market price of Cephalon's common stock, plaintiff and the
other members of the Class purchased Cephalon's common stock at
artificially inflated prices and were damaged thereby. Defendants'
conduct as alleged has damaged plaintiff and the other members of
the Class in an amount which cannot presently be ascertained.
68. Had plaintiff and the other members of the Class
known of the materially adverse information which was not disclosed
by defendants, they would not have purchased Cephalon common stock
at all, or not at the artificially inflated prices they did, and
would not have sustained damages.
COUNT II
VIOLATION OF SECTION 20 OF
THE EXCHANGE ACT AGAINST THE INDIVIDUAL DEFENDANTS
69. Plaintiff incorporates by reference and realleges
paragraphs 1 through 57 above as if set forth herein at length.
70. This Count is asserted against the Individual
Defendants and is based on Section 20(a) of the 1934 Act. The
Individual Defendants acted as controlling persons of Cephalon,
within the meaning of Section 20 of the 1934 Act. By reason of
their positions as senior officers and directors of Cephalon, the
20
Individual Defendants had the power and authority to cause or to
prevent the wrongful conduct complained of herein.
71. By reason of such wrongful conduct, the Individual
Defendants are liable to plaintiff and the Class pursuant to
Section 20 of the Exchange Act. As a direct and proximate result
of defendants' wrongful conduct, plaintiff and the other members of
the Class suffered damages in connection with their purchases of
Cephalon's common stock during the Class Period.
PRAYER FOR RELIEF
WHEREFORE, plaintiff prays for judgment as follows:
A. An order certifying the Class as set forth herein
and designating plaintiff as the representative thereof;
B. A judgment declaring the conduct of the defendants
to be in violation of law as set forth herein;
C. A judgment awarding plaintiff and the other members
of the Class compensation for the damages which they have sustained
as a result of the defendants' unlawful conduct stated above;
D. A judgment awarding plaintiff's reasonable
attorneys' fees, experts' fees, interest and cost of suit; and
E. Grant such other and further relief as this Court
may deem just.
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PLAINTIFF DEMANDS A JURY TRIAL
Plaintiff hereby demands a trial by jury of all issues so
triable.
Dated: January 29, 1996 GREENFIELD & RIFKIN LLP
/s/
By: ___________________________________
Richard D. Greenfield (RG-4046)
Mark C. Rifkin (MR-0904)
800 Times Building
Ardmore, Pennsylvania 19003
(610) 649-3900
PRONGAY & MIKOLAJCZYK
Kevin M. Prongay, Esquire
881 Alma Real Drive
Pacific Palisades, CA 90272
ATTORNEYS FOR PLAINTIFF
AND THE CLASS
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CERTIFICATlON OF NAMED PLAINTIFF
PURSUANT TO FEDERAL SECURITIES LAWS
DAVID STEINBERG ("Plaintiff") declares, as to the claims
asserted under the federal securities laws, that:
1. Plaintiff has reviewed the complaint and authorized
its filing.
2. Plaintiff did not purchase the security that is the
subject of this action at the direction of plaintiff's counsel or
in order to participate in this private action.
3. Plaintiff is willing to serve as a representative
party on behalf of the class, including providing testimony at
deposition and trial, if necessary.
4. Plaintiff's transaction(s) in the security that is
the subject of this action during the Class Period is/are as
follows:
Security Transaction Date
Cephalon Inc. Purchased 50 shares June 15, 1995
5. During the three years prior to the date of this
Certificate, Plaintiff has not sought to serve or served as a
representative party for a class in any action filed under the
federal securities laws.
6. Plaintiff has not sought to serve or served as a
representative party for a class in any action filed subsequent to
December 22, 1995.
7. The Plaintiff will not accept any payment for
serving as a representative party on behalf of the class beyond the
Plaintiff's pro rata share of any recovery, except such reasonable
costs and expenses (including lost wages) directly relating to the
representation of the class as ordered or approved by the court.
I declare under penalty of perjury that the foregoing is
true and correct. Executed this 25th day of January, 1996, at
Miami Beach, Florida.
/s/
_________________________________
David Steinberg
Affirmed to and Subscribed
Before me this 26th day
of January, 1996
/s/
__________________________
Thomas M. McLean
Notary Public
19 June 1997