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InterMune, Inc. Conclusion: According to the Final Judgment and Order of Dismissal with Prejudice, entered on August 29, 2005, from U.S. District Judge Honorable Susan Illston of the U.S. District Court for the Northern District of California, the case is settled and the action is dismissed with prejudice.
As reported by the Company’s Form 10-Q for the quarterly period ended June 30, 2005, on May 6, 2005 the parties entered into a Stipulation of Settlement of the litigation pursuant to which the plaintiff class would receive $10.4 million in exchange for a complete release of claims set forth in the complaint that arose during the period August 8, 2002 to June 11, 2003. On June 27, 2005, the court granted preliminary approval of the Stipulation of Settlement, ordered that notice be given to the affected shareholders, and set a date of August 26, 2005 for a hearing on final approval. The Stipulation of Settlement is subject to a number of conditions, including but not limited to, court approval. On June 24, 2005, the court granted preliminary approval to the settlement, ordered notice to be provided to class members and set a hearing for August 26, 2005 to consider final approval. The settlement will be funded in large part by the Company’s insurance carrier.
Earlier, according to the same SEC filing, four purported securities class actions were filed in the same court, each making identical or similar allegations against the Company, its former chief executive officer and former chief financial officer. On November 6, 2003, the various complaints were consolidated into one case by order of the court, and on November 26, 2003, a lead plaintiff, Lance A. Johnson, was appointed. A consolidated complaint titled In re InterMune Securities Litigation, No. C 03-2954 SI, was filed on January 30, 2004. The consolidated amended complaint named the Company, and its former chief executive officer and its former chief financial officer, as defendants and alleges that the defendants made certain false and misleading statements in violation of the federal securities laws, specifically Sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5. The lead plaintiff sought unspecified damages on behalf of a purported class of purchasers of the Company’s common stock during the period from January 7, 2003 through June 11, 2003. The Company and the other defendants filed a motion to dismiss the complaint on April 2, 2004, which was granted in part and denied in part. Plaintiffs filed a second amended complaint on August 23, 2004, and the defendant filed in a motion to dismiss the second amended complaint on October 7, 2004.
The original Complaint charges that Defendants violated Section 10(b) and 20(a) of the Securities Exchange Act of 1934 by making false and misleading statements about one of the its leading products, Actimmune. Specifically, the complaint alleges that defendants were aware that demand for Actimmune was declining because: (1) the most recent clinical study showed that Actimmune was not effective in the treatment of certain pulmonary diseases, (2) Actimmune inventory levels were increasing, and (3) doctor demand was falling due, in part, to the Company's decision to curtail physician education, the lifeblood of InterMune's off-label sales of Actimmune. However, despite this knowledge, the Company falsely stated during the class period that it was on course to meet projected revenue figures, which had not been previously reduced to reflect lowered demand for the drug. The complaint further alleges that on or around June 11, 2003, the Company announced that it was cutting its 2003 revenue guidance figures and slashing projected earnings from Actimmune. The Company also announced it had overstated the number of patients using Actimmune and that, contrary to its earlier representations, demand for Actimmune from physicians was flat. These disclosures sent the Company's stock price plummeting to $16.74, a 33% one-day fall.
INDUSTRY CLASSIFICATION:
SIC Code: 2834
Sector: Healthcare
Industry: Biotechnology & Drugs
| COMPANY/ISSUER NAME: | InterMune, Inc. |
| COMPANY/ISSUER TICKER: | ITMN |
| COMPANY WEBSITE: | http://www.intermune.com |
| FIRST IDENTIFIED COMPLAINT IN THE DATABASE | |||||||||||||||||
| Johnson, et al. v. InterMune, Inc., et al. | |||||||||||||||||
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| REFERENCE COMPLAINT | |||||||||||||||||
| In re InterMune, Inc. Securities Litigation | |||||||||||||||||
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| OTHER DOCUMENTS | |||
| Class Action Complaint For Violation Of The Securities Laws | |||
| Case Name and/or Number: Lombardi | |||
| Type: Complaint | Date on the document: 07/01/2003 | ||
| Certification By Lawyers Seeking To Serve As Class Counsel [Local Rule 3-7(D)] | |||
| Case Name and/or Number: Mahoney, Jr. | |||
| Type: Other | Date on the document: 07/14/2003 | ||
| Certification Of Interested Entities Or Persons | |||
| Case Name and/or Number: Mahoney, Jr. | |||
| Type: Other | Date on the document: 07/14/2003 | ||
| Complaint For Violation Of The Federal Securities Laws | |||
| Case Name and/or Number: Mahoney, Jr. | |||
| Type: Complaint | Date on the document: 07/14/2003 | ||
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