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Case Status:    DISMISSED    
On or around 03/15/2007 (Date of order of final judgment)

Filing Date: May 01, 2006

On May 21, 2008, the District Court entered the Order from the U.S. Court of Appeals for the Third Circuit. The Appeals Court affirmed the March 15, 2007 dismissal of the action in District Court.

On June 15, 2006, the Court entered the Order signed by U.S. District Judge Stewart Dalzell granting the motion to consolidate several class actions. On July 25, 2006, the Court entered the Order granting the motion to appoint the Mizla Group as lead plaintiff and Chimicles & Tikellis LLP as lead counsel. On August 10, 2006, the lead plaintiff filed a Consolidated Amended Class Action Complaint. The defendants responded by filing a motion to dismiss the Consolidated Amended Complaint on September 14, 2006. On November 1, 2006, the Court entered the Memorandum and Order granting the defendants’ motion to dismiss with leave to file an amended complaint. On November 30, 2006, the lead plaintiff filed a Second Consolidated Amended Complaint. The defendants again responded by filing a motion to dismiss the Second Consolidated Amended Complaint on December 22, 2006. On March 15, 2007, Judge Dalzell again dismissed the Second Consolidated Amended Complaint. On April 10, 2007, the plaintiffs filed a Notice of Appeal.

The original Complaint charges Discovery Labs and its President and Chief Executive Officer with violations of Section 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 by issuing a series of materially false and misleading statements to the market during the Class Period. As alleged in the Complaint, defendants made misrepresentations and/or omissions regarding the progress of U.S. regulatory approval for its self-described "lead product" Surfaxin. Throughout the Class Period, defendants repeatedly represented that they anticipated FDA approval of Surfaxin in April 2006. On April 25, 2006, the Company revealed that Surfaxin's "stability" (its ability to be stored for long periods without any change in its efficacy or its chemical profile) had not been achieved and that such failure would cause a "significant delay in the U.S. regulatory process." The Company admitted that although it had been testing the "production validation batches" periodically for "stability," stability had never been achieved. The market reacted negatively to this shocking news. The price of Discovery Labs (Nasdaq:DSCO) common stock sank 53% to close at $2.20.

COMPANY INFORMATION:

Sector: Healthcare
Industry: Biotechnology & Drugs
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: DSCO
Company Market: NASDAQ
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: E.D. Pennsylvania
DOCKET #: 06-CV-01820
JUDGE: Hon. Stewart Dalzell
DATE FILED: 05/01/2006
CLASS PERIOD START: 12/28/2005
CLASS PERIOD END: 04/25/2006
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Law Offices of Bernard M. Gross (Philadelphia) (former)
    1515 Locust Street, 2nd Floor, Law Offices of Bernard M. Gross (Philadelphia) (former), PA 19102
    215-561-3600 215-561-3000 · bmgross@bernardmgross.com
  2. Squitieri & Fearon LLP (New York)
    32 East 57th Street, 12th Floor, Squitieri & Fearon LLP (New York), NY 10022
    212.421.6492 212.421.6492 · info@sfclasslaw.com
No Document Title Filing Date
COURT: E.D. Pennsylvania
DOCKET #: 06-CV-01820
JUDGE: Hon. Stewart Dalzell
DATE FILED: 11/30/2006
CLASS PERIOD START: 03/15/2004
CLASS PERIOD END: 06/06/2006
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Chimicles & Tikellis LLP (Haverford)
    361 West Lancaster Avenue, Chimicles & Tikellis LLP (Haverford), PA 19041
    888.805.7848 610.649.3633 · mail@chimicles.com
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