WebMD Wins Ruling Dismissing Securities Fraud Suit
WebMD Health Corp. (WBMD), an online provider of medical information, obtained the dismissal of a lawsuit brought by investors who claimed the company defrauded them by releasing revenue forecasts it knew to be inflated.
U.S. District Judge John Keenan in New York dismissed the lawsuit today while giving the investors 60 days to file a new complaint. He said the plaintiffs failed to prove that statements by the company from February 2011 to January 2012 were made with “actual knowledge” that they were false or misleading.
WebMD and its executives “were not obligated to predict correctly the particular factor that ultimately causes their projection not to come true,” Keenan wrote in an opinion.
Kate Hahn, a spokeswoman for New York-based WebMD, and Jeffrey Zwerling, a lawyer for plaintiffs including the Wayne County Employees’ Retirement System, didn’t immediately return telephone calls for comment on the ruling.
The case is In Re WebMD Health Corp., 11-cv-5382, U.S. District Court, Southern District of New York (Manhattan).
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