On December 15, 2008 the judge entered a final order approving the settlement, awarding attorneys' fees and closing the case.
On July 9, 2008 plaintiffs' attorneys issued a press release and Notice of Proposed Settlement outlining the details of the $18.5 million agreement. Attorneys intend to apply for 12% fees and reimbursement of expenses in the amount of $950,000. A fairness hearing has been scheduled for September 26, 2008.
On January 20, 2006, the plaintiff filed a motion to certify the class. On February 28, 2006, the Court entered the Order signed by U.S. District Judge William H. Pauley III certifying the action as a class action. Alan Hevesi is certified as the Class Representative and Lead Counsel (Milberg Weiss Bershad & Schulman LLP) is approved as Class Counsel.
According to a press release dated October 15, 2005, refusing to assert jurisdiction, the U.S. District Court for the Southern District of New York dismissed a securities fraud class action by investors against Bayer A.G. Investors sued Bayer A.G., an international healthcare and chemical corporation, challenging the dissemination of information regarding the safety and likely success of the cholesterol-lowering drug Baycol. Bayer A.G. sold the drug worldwide, distributing the drug within the United States through its subsidiary Bayer Corp., before withdrawing the product in 2001 due to risks of developing rhabdomyolysis. The district court dismissed the claims against Bayer A.G. for lack of subject matter jurisdiction with leave to amend. Bayer A.G. then moved to dismiss the newly amended foreign purchase claims. Subject matter jurisdiction exists in fraud claims involving largely foreign transactions only when the complaint establishes sufficient contact with the United States, according to the district court. Sufficient contacts may exist for alleged misconduct occurring within the country or substantially affecting the country or its citizens. District court declines jurisdiction over foreign corporation. In its analysis of subject matter jurisdiction, the district court noted Bayer A.G.'s alleged fraud occurred in Germany while its subsidiary's fraud occurred within the U.S. The complaint failed to show substantial effects within the U.S. from the alleged misstatements by Bayer A.G, according to the district court.
Plaintiffs filed a Second Amended Consolidated Complaint on January 14, 2005.
On September 30, 2004, the Court granted in part and denied in part Defendants’ motion to dismiss the First Amended Complaint. The Court held that Lead Plaintiff had adequately pleaded certain claims against Defendants on behalf of purchasers in U.S. markets, and U.S. purchasers on foreign markets, during the Class Period, and would be permitted discovery with respect to those claims. The Court dismissed plaintiffs’ claims as to certain other time periods and as to other individuals who had been named as defendants, and excluded from the Class, citizens of foreign countries who purchased Bayer securities in foreign markets.
The complaint alleges, among other things, that throughout the Class Period defendants misrepresented Bayer AG's success in marketing it's Baycol cholesterol lowering drug. Defendants' statements were materially false and misleading because Bayer AG's own scientists were stating internally that Baycol, when administered with other popular medications or at high dosages, caused unacceptable risk of serious side effects. In fact, throughout the Class Period Bayer AG was informed that patients taking Baycol were experiencing serious and life threatening side
effects. Baycol was belatedly withdrawn from the market in August 2001 after the FDA raised serious concerns about the safety of Baycol in light of reports of Baycol patients dying. The true facts concerning defendants' knowledge of the dangers of Baycol and the Company's potential liability to Baycol patients were not completely disclosed until February 22, 2003, in connection with court filings in various
personal injury actions commenced against Bayer AG by persons who had been prescribed Baycol and had suffered severe side effects. These court documents demonstrated defendants' early knowledge of the risk of serious or life threatening side effects to patients taking Baycol, including the knowledge that patients taking Baycol were found to have 5 to 10 times the chance of developing a life threatening illness -- rhabdomyolysis -- as patients taking other similar medicines. The price per share of Bayer AG ADRs fell approximately 17% when Baycol was withdrawn from the market in August 2001. Following the February 22, 2003 disclosure of the true state of defendants' knowledge of the dangers of Baycol, Bayer AG ADRs declined an additional 27%, from $17.15 per share to $12.58 days after the revelation -- more than 68% below the trading price at the beginning of the Class Period ($39.75).