An opinion was issued on Wednesday in the District of New Jersey by Judge Evelyn Padin, ruling on bid to dismiss a complaint filed by Curtis Laasko and Benoit Albiges (both individually and on behalf of all other similarly situated) against defendant Endo International, PLC.
The plaintiffs represent a larger class of owners of Endo’s common stock. The defendant is a “pharmaceutical company that manufactures, markets, and sells generic and branded pharmaceuticals, including opioids, in the U.S. and internationally.”
In their complaint, the plaintiffs allege that the defendant violated the Exchange Act when they made materially false and misleading statements to investors and recklessly disregarded factual information that undermined their public statements. Specifically, the defendant allegedly “engaged in a coordinated campaign to obstruct opioid-related litigation and misrepresented the Company’s financial condition.”
The defendant responded to the plaintiff’s second amended complaint by stating that it made nearly identical allegations to the first amended complaint and failed to adequately allege the elements of their securities claims.
The Court determined that the plaintiffs had not adequately pled their claims, noting that the plaintiffs second amended complaint did not allege any specific facts that indicated the defendant’s disclosures were false or misleading. They further explained that the defendant “met any duty it had to disclose under the federal securities laws when it disclosed the pending opioid-related litigation” to its investors.
The plaintiffs’ claims that Endo’s risk disclosures were generic catch-all provisions was also denied by the Court, who specified that they could not “claim that defendants had a duty to disclose additional details associated with the risks of opioid-related litigation and liability where defendants’ risks were merely speculative.”
Judge Evelyn Padin further ruled regarding the plaintiffs’ scienter claims that “even if plaintiffs had adequately pled material misstatements or omissions, the claims against Defendants would be dismissed due to Plaintiffs’ failure to sufficiently plead facts supporting a strong inference of scienter.” The plaintiffs’ remaining claims failed since they all relied on the strength of the securities violation, which the Court dismissed.
Since the court determined that the plaintiffs also failed to properly move for leave to amend their complaint, the second amended complaint was dismissed with prejudice and their motion for leave to amend was denied.The plaintiffs were represented in the litigation by Pomerantz LLP while the defendants were represented by Latham & Watkins and Gibbons PC.
