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SETTLEMENT NEWS:
SCIELE PHARMA: Expects Approvals for $4.7M Settlement in 2008
Staff Writer
Class Action Reporter. May 6, 2008
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EXCERPT: Sciele Pharma, Inc., f/k/a First Horizon Pharmaceutical Corp., expects to receive preliminary and final approvals for the $4.7-million settlement of a consolidated securities fraud class action suit that was filed against the company. On Aug. 22, 2002, the company, certain former and current officers and directors were named as defendants in a consolidated securities lawsuit filed with the U.S. District Court for the Northern District of Georgia. The plaintiffs in the class action alleged in general terms that the company violated Sections 11 and 12(a)(a) of the U.S. Securities Act of 1933 and that the company violated Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. In an amended complaint, the plaintiffs claim that the company issued a series of materially false and misleading statements to the market in connection with the company's public offering on April 24, 2002, and thereafter relating to alleged "channel stuffing" activities. The amended complaint also alleged controlling person liability on behalf of certain of the company's officers under Section 15 of the Securities Act of 1933 and Section 20 of the Securities Exchange Act of 1934. The plaintiffs seek an unspecified amount of compensatory damages. On Sept. 29, 2004, the U.S. District Court for the Northern District of Georgia dismissed, without prejudice, the class action. Although the lawsuit was dismissed, the court granted the plaintiffs the right to refile provided that the plaintiffs pay all of the defendant's fees and costs associated with filing the motion to dismiss the lawsuit. The plaintiffs did not file a second amended complaint as permitted, but instead filed a motion asking the District Court to reconsider its Sept. 29, 2004 order and to lift the condition that they must pay defendants' fees and costs before further amendment. |
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