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Case ID: 2514 | Stocks | 07/12/2004
A class action has been filed against medical testing company Laboratory Corporation of America Holdings (NYSE: LH) and certain of its officers and directors by stockholders who purchased the company's common stock between February 13 and October 3, 2002. The action claims that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company's securities. The stockholders seek to recover compensatory damages for the loss of value of their stock.
During this time period, the company issued statements that allegedly failed to disclose, or misrepresented, the following adverse facts, among others: 1. That LabCorp was experiencing increased competition in its traditionally strongest and core markets, such as the Carolinas. 2. That the company had understaffed certain of its core markets, leading to a lack of key employees, such as phlebotomists and account representatives, causing a material deterioration of service levels and a loss of business to increased competition. 3. That the decreased sale volume was caused by material operational deficiencies, rather than by a couple of pending deals that closed late, as the company had represented. 4. That the defendants knew that the company's sales problems would continue in the foreseeable future, contrary to its statements that volume growth would increase. 5. That, as a result of the foregoing, the company's assurance that its historical strong growth would continue lacked any reasonable basis. Throughout this time period, LabCorp insiders, including the individual defendants, sold a total of 316,112 shares of LabCorp common stock at artificially inflated prices, grossing a total of over $26 million. On October 3, 2002, after the close of regular trading, LabCorp shocked the market by announcing that it expected disappointing third quarter of 2002 results, due to "continued slowdown in volume growth in the routine, or core, testing business in certain key regions of the country," which it expected would continue at least until the end of 2002. Investors, primed by the defendants' prior statements, were shocked to learn that the slowdown had continued and was not expected to abate until after the end of the year, and that the slowdown had been in the company's core business. In reaction to the company's belated disclosure, the price of LabCorp common stock plummeted, falling 34.6% in one day, from a close of $33.18 per share on October 3 to $21.68 per share on October 4, on trading volume of over 21.2 million shares, which is many times the company's average daily trading volume. At Lawcash.com, it is our goal to keep you informed about important legal cases, class actions and settlements. Our lawyers offer free legal evaluations in tort cases, class actions, personal injury, and other lawsuits because we are dedicated to helping you resolve your legal complaints. Other Stocks Cases of Interest The complaint charges CarMax and certain of its officers and directors with violations of the Securities Exchange Act of 1934. CarMax is a nationwide retailer of new and used automotive vehicles. CarMax also provides customers with a full range of related products and services, including the financing of vehicle purchases through CarMax Auto Finance, the Company's own finance operation, and third-party financing providers; the sale of extended service plans and accessories; the appraisal and purchase of vehicles directly from consumers; and vehicle repair service.
Several class actions have been filed against soil contamination remediator Bennett Environmental, Inc., (AMEX:BEL; TSX:BEV) and certain of its officers and directors by American and Canadian stockholders who purchased the company's common stock between June 2, 2003, and July 22, 2004. The actions claim that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company's securities. A class action has been filed against Astea International Inc. (ATEA), certain of its officers and directors by stockholders who purchased the company's common stock between May 11, 2005 and March 31, 2006. The action claims that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company's securities. The stockholders seek to recover compensatory damages for the loss of value of their stock. A class action has been filed against neonatal and perinatal physician services provider Pediatrix Medical Group, Inc. (NYSE: PDX) and certain of its officers and directors by stockholders who purchased the company's common stock between April 17, 2002, and June 23, 2003. A class action has been filed against Merrill Lynch & Co., Inc. (NYSE:MER), a certain of its officers and directors by stockholders who purchased the company's common stock between January 01, 1990 and January 21, 2005. The action claims that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company's securities. The stockholders seek to recover compensatory damages for the loss of value of their stock. A class action has been filed against Radiation Therapy Service, Inc., (NASDAQ: RTSX) and certain of its officers and directors by stockholders who purchased the company’s common stock between June 17, 2004 and September 8, 2004. The Company owns, operates and manages treatment centers, focused on providing comprehensive radiation treatment alternatives ranging from conventional external beam radiation to newer, technologically advanced options. The action claims that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company’s securities. The stockholders seek to recover compensatory damages for the loss of value of their stock. |
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