Lowenstein Sandler, as co-counsel with Pomerantz Law and Bernstein Litowitz Berger & Grossmann LLP, has helped secure a $97 million settlement for investors in a securities fraud class action against the pharmaceutical company Perrigo Co. plc., following a prolonged litigation.

The suit was filed in 2016, when media coverage about the company’s weakened position resulted in plummeting share prices and damage to stockholders. It made several allegations:

  • that Perrigo misled investors about the strength of its business in order to fend off a $29 billion hostile takeover bid by pharmaceutical manufacturer Mylan;
  • that it participated in a price-fixing scheme relating to its generic drugs;
  • and that it misrepresented the business impact of its 2015 acquisition of Omega Pharma NV. I

Perrigo denied the claims but agreed to pay the $97 million to avoid continued litigation.

The case was significant in its certification of two parallel classes of investors: those who bought shares on the New York Stock Exchange and those who bought shares in Israel on the Tel Aviv Stock Exchange ("TASE”). Because U.S. Supreme Court precedent prevents foreign plaintiffs from pursuing recovery in U.S. federal courts for losses from transactions on foreign exchanges, each class potentially faced very different and unequal prospects for recovery.

The shareholders successfully argued that the court should exercise supplemental jurisdiction over the claims brought under Israeli law on behalf of the TASE purchasers because Israeli law applied the same standards as U.S. law. This was the first time a class of non-U.S. securities purchasers has been certified as a class in a U.S. court.

The Lowenstein team included Michael B. Himmel.

The settlement was reported by Law360.