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Case Status:    DISMISSED    
On or around 05/18/2006 (Date of order of final judgment)

Filing Date: June 24, 2003

According to a press release dated May 23, 2006, a class action lawsuit alleging that Laboratory Corporation of America executives released inaccurate information to inflate the company's stock price has been dismissed. On June 2003, two LabCorp investors filed two separate lawsuits claiming company executives sold hundreds of thousands of personal stock shares before an announcement in October 2002 that the company would not meet third quarter projections. In 2004, a federal court decided to consolidate all the complaints filed in the matter into one class action suit. The lawsuit claimed that between Feb. 13 and Oct. 3, 2002, the company lied about its volume growth and its competitiveness in the medical community in order to inflate its stock price. …In an opinion filed last week, U.S. District Court Judge James A. Beaty wrote that the plaintiffs in the case failed to meet the standards set forth by law to prove that LabCorp committed securities fraud. In order to prove that, the plaintiffs had to show that the company purposely and recklessly lied or omitted information that caused damages. In addition, they had to show that such information was not covered by the forward-looking statement safe harbor the law provides. This protection exempts statements such as projections of future revenues from liability if "accompanied by meaningful cautionary statements." The complaint alleged that of 28 separate statements about LabCorp's financial standing issued in 2002, four were false and 24 were for ward-looking statements not protected by the safe harbor provision. The court disagreed and ruled that the company used the cautionary language required to be exempt from lia bility in all the forward looking statements. It also said that the other four statements could not violate security laws because these were simply optimistic statements.

The original complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by
issuing a series of materially false and misleading statements to the market
between February 13, 2002 to October 3, 2002. The Complaint alleges that by the
start of the Class Period LabCorp was being adversely impacted by a host of
undisclosed negative trends, which were causing the Company to experience
declining revenues and earnings. In particular the Complaint alleges that
LabCorp failed to disclose and/or misrepresented the following adverse facts,
among others: (1) that LabCorp was currently experiencing a material decline in
growth rates for routine/core testing volumes; (2) that LabCorp's marketing and
relationship management staff were inadequate and could not effectively compete
with local and regional clinical laboratory services; (3) that the service
levels, including price, turnaround time and quality of service, of the
Company's remote testing facilities including the Company's STAT laboratories
and patient care facilities, among others, were inadequate and could not
effectively compete with local and regional clinical laboratory services; (4)
that the types of clinical laboratory services available through the Company's
remote testing facilities were limited and could not effectively compete with
local and regional clinical laboratory services; and (5) based on the
foregoing, defendants' opinions, projections and forecasts concerning the
Company and its operations were lacking in a reasonable basis at all times.

The complaint further alleges that rather than disclose the truth about the Company's weakening condition and jeopardize its ability to complete acquisitions, defendants issued a series of materially false and misleading statements to the market in order to inflate the price of LabCorp common stock and enable the Company to use its stock as currency for a material acquisition. In addition, prior to the disclosure of
the true facts about the Company, LabCorp insiders sold more than $29 million
of their personally-held LabCorp common stock to the unsuspecting public. The truth about LabCorp was partially revealed, when on October 3, 2002, defendants announced that LabCorp failed to meet revenue and earnings guidance
for the third quarter ended September 30, 2002, as well as the remainder of
2002, due to a revenue shortfall, primarily, in the South and Southeast regions
of the U.S. stemming from a material loss of routine/core testing volumes among
independent physicians. Subsequently, on October 4, 2002, defendant MacMahon
admitted that defendants were aware that the Company was losing sales to local
and regional labs and had attempted, unsuccessfully, to "remedy the problem" as
early as May 2002. Following these announcements, the price of LabCorp common
shares collapsed, losing over 34% of their value in one day of trading to close
at $21.68 per share on October 4, 2002, and falling over 58% from the Class
Period high of $51.98 per share reached on or about May 10, 2002.

COMPANY INFORMATION:

Sector: Healthcare
Industry: Healthcare Facilities
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: LH
Company Market: New York SE
Market Status: Public (Listed)

About the Company & Securities Data


"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: M.D. North Carolina
DOCKET #: 03-CV-0591
JUDGE: Hon. James A. Beaty, Jr.
DATE FILED: 06/24/2003
CLASS PERIOD START: 02/13/2002
CLASS PERIOD END: 10/03/2002
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Bernstein Liebhard & Lifshitz, LLP (New York)
    10 E. 40th Street, 22nd Floor, Bernstein Liebhard & Lifshitz, LLP (New York), NY 10016
    800.217.1522 · info@bernlieb.com
  2. Cauley Geller Bowman Coates & Rudman LLP (Little Rock, AR)
    P.O. Box 25438, Cauley Geller Bowman Coates & Rudman LLP (Little Rock, AR), AR 72221-5438
    501.312.8500 501.312.8505 ·
  3. Law Offices of Charles J. Piven, P.A.
    World Trade Center-Baltimore,401 East Pratt Suite 2525, Law Offices of Charles J. Piven, P.A., MD 21202
    410.332.0030 · pivenlaw@erols.com
  4. Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY)
    One Pennsylvania Plaza, Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY), NY 10119-1065
    212.594.5300 ·
  5. Robbins Umeda & Fink, LLP (San Diego)
    1010 Second Avenue, Suite 2360, Robbins Umeda & Fink, LLP (San Diego), CA 92101
    800-350-6003 · info@ruflaw.com
No Document Title Filing Date
COURT: M.D. North Carolina
DOCKET #: 03-CV-0591
JUDGE: Hon. James A. Beaty, Jr.
DATE FILED: 03/18/2004
CLASS PERIOD START: 02/13/2002
CLASS PERIOD END: 10/03/2002
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Faruqi & Faruqi LLP (New York) (former)
    320 East 39th Street, Faruqi & Faruqi LLP (New York) (former), NY 10016
    212.983.9330 212.983.9331 · Nfaruqi@faruqilaw.com
  2. McDaniel, Anderson & Stephenson, LLP
    P.O. Box 58186 , McDaniel, Anderson & Stephenson, LLP, NC 27658
    ·
  3. Milberg Weiss Bershad & Schulman LLP (New York)
    One Pennsylvania Plaza, 49th Floor, Milberg Weiss Bershad & Schulman LLP (New York), NY 10119
    212.594.5300 212.868.1229 · info@milbergweiss.com
  4. Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY)
    One Pennsylvania Plaza, Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY), NY 10119-1065
    212.594.5300 ·
  5. Schiffrin & Barroway LLP
    3 Bala Plaza E, Schiffrin & Barroway LLP, PA 19004
    610.667.7706 610.667.7056 · info@sbclasslaw.com
No Document Title Filing Date
No Document Title Filing Date