Several class actions have been filed against medical products and services company Cardinal Health, Inc., (NYSE:CAH) and certain of its officers and directors by stockholders who purchased the company's common stock between October 24, 2000, and June 30, 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. The stockholders seek to recover compensatory damages for the loss of value of their stock.

The proposed class also includes all persons who acquired Cardinal's shares through its acquisitions of Alaris Medical, Intercare, Medicap, Syncor, Boron Lepore, InGel, Ni-Med, SP Pharmaceuticals, and International Processing Corporation. Current and former employees who purchased stock through Cardinal's Retirement Savings Plans are also included.

The action alleges that Cardinal and certain of its officers and directors issued false statements concerning the company's financial condition. Specifically, the complaint alleges that the defendants failed to disclose that: (1) Cardinal manipulated various aspects of its accounting practices to portray profitability to the market; (2) the company held inventory for an average of two months, and reaped exorbitant profits from price inflation; (3) it improperly accounted for the $22 million recovered from vitamin-maker antitrust litigation by booking those recoveries as revenue before the cases had been resolved; and (4) the company’s pharmaceutical distribution business improperly classified revenues as either operating revenue or revenues from bulk deliveries to consumer warehouses.

On June 21, 2004, Cardinal announced that, as part of a Securities and Exchange Commission formal investigation, it had received an SEC subpoena. On June 30, 2004, the company announced that earnings per share for fiscal 2004 would be lower than previously expected. The market responded quickly to these announcements, Cardinal shares falling $17.19 per share or 24.54% on July 1, 2004, to close at $52.86 per share.

If you purchased securities issued by Cardinal Health during the applicable period, you may request appointment by the court as a lead plaintiff if you do so by August 31, 2004. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the court must determine that your claim is typical of the claims of other class members, and that you will adequately represent the class. Under certain circumstances, one or more class members may together serve as lead plaintiffs. Your ability to share in any recovery is not affected by the decision whether or not to serve as a lead plaintiff. You may retain any counsel of your choice to serve as you in this action, or you may choose to do nothing, and remain in the class as a silent member.