Investor Class Approved In Suit V. Boston Scientific

Investor Class Approved In Suit V. Boston Scientific - 3/10/2009

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HEADLINES \| SETTLEMENTS AND DISMISSALS \| COURT FILINGS LINKS TO OTHER NEWS \| NEWS ARCHIVE	HEADLINES ARCHIVED SETTLEMENTS AND DISMISSALS ARCHIVED

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Investor Class Approved In Suit V. Boston Scientific
Morgan Bettex

Securities Law 360. March 10, 2009
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EXCERPT: A judge certified a class of shareholders Tuesday in a long-standing consolidated securities fraud action against Boston Scientific Corp. and several of its executives alleging the biotech company failed to disclose information about the recall of one of its stents. In a 29-page memorandum and order filed in the U.S. District Court for the District of Massachusetts, Judge Douglas P. Woodlock certified the proposed class of shareholders and appointed the lead plaintiff, the Mississippi Public Employees Retirement System, as the class representative. The court also appointed lead counsel Zimmerman Reed PLLP as class counsel. PERS had moved to certify a class of plaintiffs comprising all those who acquired Boston Scientific equity securities between Nov. 20, 2003, and July 15, 2004. The class certification is the latest development in a series of related securities fraud suits first filed in 2005, and later consolidated into a single case in 2006, alleging that Boston Scientific and nine executives violated federal securities laws by making misleading statements about the company's Taxus drug-eluting coronary stent that was eventually recalled, thereby causing Boston Scientific’s securities to be inflated artificially. The case dates to 2004, when Boston Scientific's Taxus stent first hit the market. The original complaint alleged that though the company immediately began touting its new product, “defendants did not disclose complaints they had received from doctors in Europe that the balloon used during insertion of the Taxus stent did not deflate.” The plaintiffs claim that though the company continued to downplay potential problems with the device, executives knew that the issues were much more significant. In fact, shortly after releasing the Taxus stents, Boston Scientific began planning a manufacturing change based on the realization that the problem with the stents was a design flaw, according to the plaintiffs.

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