Case Update: This case has been settled for a total of $3 million.
On February 10, 2015, Pomerantz LLP was appointed Lead Counsel in a class action lawsuit against Retrophin, Inc. and certain of its officers. The class action, filed in United States District Court, Southern District of New York, and docketed under 14-cv-8376, is on behalf of a class consisting of all persons or entities who purchased Retrophin securities between March 27, 2014 and September 30, 2014, inclusive (the "Class Period"). This class action seeks to recover damages against Defendants for alleged violations of the federal securities laws under the Securities Exchange Act of 1934 (the "Exchange Act").
Retrophin, Inc., a biopharmaceutical company, focuses on the development, acquisition, and commercialization of therapies for the treatment of serious, catastrophic, or rare diseases. It sells Chenodal, a synthetic oral form of chenodeoxycholic acid for the treatment of radiolucent stones in well-opacifying gallbladders, and Vecamyl, for the treatment of hypertension.
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements, and failed to disclose material adverse facts about the Company's business, operations, prospects and performance. Specifically, during the Class Period, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Retrophin's founder and Chief Executive Officer was committing stock-trading irregularities and other violations of the Company's Incentive Compensation Plan and other securities rules; (ii) said irregularities included grants of shares in violation of the Company's Incentive Compensation Plan and the failure to disclose stock grants to employees; and (iii) as a result of the above, the Company's financial statements were materially false and misleading at all relevant times.
On September 16, 2014, after the close of trading, the Company issued a press release and filed a Form 8-K with the SEC announcing that on September 15, 2014, it had reached an agreement with its Chief Financial Officer, Marc Panoff, pursuant to which Mr. Panoff's employment with the Company will terminate, effective as of February 28, 2015. Also, the Company announced that on September 10, 2014, Jeffrey Paley, MD abruptly stepped down as a member of the Board of Directors. As a result of this news, shares of Retrophin fell $1.03 or over 8%, on unusually heavy trading, to close at $11.46 on September 17, 2014.
On September 30, 2014, after the close of trading, the Company issued a press release announcing that its Board of Directors terminated its Chief Executive Officer, Martin Shkreli, effective immediately, and appointed Stephen Aselage as interim Chief Executive Officer. As a result of this news, shares of Retrophin fell $0.40 or almost 4.5%, on unusually heavy trading, to close at $8.62 on October 1, 2014.