Pension Fund ABP Settles with Merck in Securities Class Action
Five-year litigation related to Vytorin ENHANCE study ends in $215 million
HEERLEN, Netherlands and AMSTERDAM, Feb. 14, 2013
HEERLEN, Netherlands and AMSTERDAM, Feb. 14, 2013 /PRNewswire/ --The Dutch
pension fund Stichting Pensioenfonds ABP ("ABP"), together with three co-lead
plaintiffs, has reached a settlement with Merck and certain of its current and
former officers and directors, whereby Merck will pay $215 million to resolve
a five-year-old securities class action against all of the Merck defendants.
This settlement is part of a $688 million total settlement that Merck agreed
to with plaintiffs in two class actions that were combined for trial: Merck &
Co., Inc. Vytorin/Zetia Securities Litigation; and Schering-Plough
Corporation/Enhance Securities Litigation.
The Merck Vytorin class action, filed in 2008, is pending before Judge Dennis
M. Cavanaugh in U.S. District Court for the District of New Jersey. The
settlement comes three weeks before a scheduled trial date of March 4. ABP,
International Fund Management SA (part of the Deka Bank Group), the
Jacksonville Police and Fire Retirement System, and the General Retirement
System of the City of Detroit are the four institutional investor lead
plaintiffs in the class action. The Merck Vytorin class action settlement
covers all investors who purchased Merck stock or options between December 6,
2006and March 28, 2008.
ABP's settlement stems from claims that Merck delayed disclosing for two years
results of a clinical trial called ENHANCE - which indicated that Merck's
anti-cholesterol drug Vytorin had no statistical advantage in treating
atherosclerosis when compared to a generic statin drug, simvastatin. Merck
investors alleged that the delay caused a substantial drop in the value of
their shares when results of the study were published in 2008.
Merck has denied and continues to deny these claims, contending that the
company and its officers acted responsibly in connection with the ENHANCE
study. The settlement is subject to approval by Judge Cavanaugh.
"As important as recovery of our losses, we have taken up this case to
underline our views on good corporate governance. This outcome should serve as
a reminder that material information should be shared with the market as soon
as it becomes available," stated Henk Brouwer, chairman of ABP. "Nonetheless,
the $215 million represents a significant class recovery - one of the largest
achieved in a case alleging fraud without a government finding of wrongdoing
against the company."
ABP was represented by U.S. securities and corporate governance law firm Grant
& Eisenhofer P.A., which has successfully represented the fund in numerous
other shareholder cases.
Stichting Pensioenfonds ABP (ABP - Foundation Pension Fund ABP) is the
industry-wide pension fund for employers and employees of government and
educational institutions in the Netherlands. ABP has 2.8 million participants
and an amount of 281 billion Euros in available assets (as at year-end 2012).
This makes ABP one of the top three pension funds in the world in terms of
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