According to the docket posted, on February 15, 2006, the settlement hearing was held before U.S. District Judge Stephen C. Robinson. The settlement was accepted by court as reasonable and the Court entered the Final Judgment and Order of Dismissal with Prejudice the next day.
By the Notice of Pendency of Class Action and Settlement, the proposed settlement, in the amount of $4,750,000, is embodied in a Stipulation of Settlement dated November 2, 2005, which has been filed with the Court. A hearing will be held on February 15, 2006 to consider whether: (1) the proposed settlement is fair, reasonable, adequate, and in the best interests of the Class and should be approved; (2) the Action should be dismissed with prejudice; (3) the Plan of Allocation should be approved; and (4) the application of Lead Counsel for attorneys’ fees and reimbursement of expenses and the payment of compensatory awards to the Class Representatives should be approved.
As summarized by the Company’s FORM 10-QSB for the quarterly period ended September 30, 2005, on March 1, 2001 and March 19, 2001, two additional similar lawsuits were filed by other former shareholders of MBI. In May 2001, the actions were consolidated. The plaintiffs were seeking rescission or compensatory damages, payment of fees and expenses, and further relief. In January 2002, the plaintiffs filed a second amended complaint adding an additional securities claim against us and the named officers. In August 2003, the court granted summary judgment as to certain securities claims and dismissed the claims, and denied summary judgment as to other securities claims. On November 3, 2005, the Court preliminarily approved a settlement reached by the parties, which will be funded by the Company's insurers. A hearing for final approval of the settlement has been scheduled for February 15, 2006.
The original complaint alleges that defendants iolated federal securities laws by issuing materially false and misleading registration statements in connection with its merger with Molecular Biosystems. The complaint alleges that the defendants issued materially false and misleading information regarding Oxygent in the merger related registration statements. Yet only five days after the merger was completed, the defendants, for the first time, publicly disclosed that enrollment for its Phase III cardiac surgery study concerning Oxygent in the US would be suspended indefinitely. Accordingly, it became evident that Oxygent would not be ready for the market in the foreseeable future.