Pharmaceutical company Antares Pharma Inc. and its board of directors were sued on Tuesday over a proposed acquisition with Halozyme Therapeutics Inc. that allegedly violates the Securities Exchange Act of 1934.
Antares shareholder Joseph Ochoa filed the complaint in the southern district of New York, claiming that the Solicitation/Recommendation Statement Antares submitted to the Securities and Exchange Commission in April concerning the acquisition is incomplete and materially misleading. The lawsuit focuses on the company’s use of non-GAAP projections to recommend shareholders tender their shares. According to the complaint, Antares failed to include a reconciliation table of the non-GAAP measures used to the most comparable GAAP measures, as required by updated Compliance and Disclosure Interpretations released by the SEC in 2016. Specifically, companies are required to disclose line item projections for the financial metrics used to calculate the non-GAAP measures, the plaintiff argues.
“Disclosure of the…line item projections is vital to provide investors with the complete mix of information necessary to make an informed decision when deciding whether to tender their shares in connection with the Proposed Transaction,” the complaint states.
The complaint alleges violations of Sections 14(d), 14(e) and 20(a) of the Exchange Act. The plaintiff is seeking to enjoin the defendants from proceeding with the proposed acquisition, as well as damages.
The plaintiff is represented by Lifshitz Law PLLC.