Case Update: This case has been settled for a total of $7 million.
On September 15, 2014, Pomerantz LLP was appointed Lead Counsel in a class action law suit against STAAR Surgical Company ("STAAR" or the "Company").
The class action, filed in United States District Court, Central District of California, and docketed under 14-cv-05263, is on behalf of a class consisting of all persons or entities who purchased STAAR securities between February 27, 2013 and June 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").
STAAR designs, develops, manufactures and sells implantable lenses for the eye and delivery systems used to deliver lenses into the eye. The Company purports to be the leading maker of lenses used worldwide in corrective or "refractive" surgery, and also makes lenses for use in surgery that treats cataracts.
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements and/or failed to disclose that the Company's Monrovia Facility: (i) lacked adequate methodologies and facilities for the manufacture, packing, storage and installation of the Company's implantable lenses; (ii) lacked adequate procedures for documenting complaints, sterility testing, and maintaining required records; and (iii) as a result of the foregoing, the Monrovia Facility was not in conformity with current good manufacturing practice requirements at all relevant times.
On June 30, 2014, the U.S. Food and Drug Administration ("FDA") publicly released a Warning Letter, dated May 21, 2014, concerning an inspection of STAAR's Monrovia Facility which took place from February 10, 2014 to March 21, 2014. The FDA letter noted several regulatory violations at the facility and stated that, among other things, "the methods used in, or the facilities or controls used for" manufacture, packing, storage or installation of the Company's implantable lenses are "not in conformity with the current good manufacturing practice requirements." The FDA further advised STAAR that "failure to promptly correct these violations may result in regulatory action being initiated by the FDA without further notice."
On this news, STAAR shares declined $1.89, or nearly 11.25%, to close at $14.91 on July 1, 2014.