Judge Dismisses Lawsuit Against CVS Alleging Acquisition Mis

Judge Dismisses Lawsuit Against CVS Alleging Acquisition Misconduct


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February 11, 2021
Judge Mary McElrory of the District of Rhode Island dismissed a case brought by CVS stockholders against the pharmacy chain, which alleged that the company and its executives downplayed and hid its struggling long-term care business to ensure that CVS’s acquisition of Aetna would proceed smoothly. The judge specifically found that the plaintiffs failed to meet an elevated pleading standard mandated by the cause of action.
The claims arose from CVS’s acquisition of Omnicare, a “national distributor of pharmaceuticals with a leadership role in the skilled nursing facility arena.” The plaintiffs contended that CVS made false and misleading statements and omissions to hide difficulties in long-term care businesses, so as to preserve the upcoming deal with Aetna. The class is defined as those who held stock between the two acquisitions.

Related Keywords

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