Bayer Faces U.S. Shareholdeer Lawsuit
FRANKFURT (The Associated Press / March 12, 2003) -- Bayer AG's U.S.
shareholders have filed a lawsuit against the German drug maker, seeking
damages for the fall in its share price caused by the drug Baycol, the
company said Wednesday.
Bayer took Baycol, a cholesterol-fighting drug, off the market in August
2001 after it was linked to about 100 deaths worldwide.
The lawsuit claims that current Chief Executive Werner Wenning and former
CEO Manfred Schneider withheld or misrepresented information on Baycol.
It also alleges violations of the Securities Exchange Act of 1934.
Concerns over the possible cost of litigation have weighed on Bayer's
stock ever since it withdrew the drug in 2001. In the past month, however,
losses have been particularly steep as press reports citing plaintiffs'
lawyers have said that Bayer knew about the dangers of Baycol before
taking it off the market.
Bayer didn't disclose which law firm was handling the case bu said the
suit was filed in federal court in New York.
This latest lawsuit adds Bayer shareholders to the thousands already
seeking damages over Baycol. In February, Bayer said the number of plaintiffs
had risen to around 7,800. Until now, Bayer has settled about 450 cases
out of court at a cost of $125 million.
Costs to date are believed to have been covered by the company's insurance.
Bayer has no provisions for litigation costs.
Bayer has said it will give an update on how many cases have been filed,
when it releases 2002 results Thursday.
There are currently cases pending in both the federal and state court
systems in the United States.
Bayer's American depositary shares traded Wednesday afternoon at $11.78,
down 76 cents, or 6.1 percent, on the New York Stock Exchange. |
