On February 11, 2021, Williams & Connolly secured dismissal with prejudice of a putative securities class action filed against CVS Health in the U.S. District Court for the District of Rhode Island arising from the company’s acquisition of Omnicare in 2015 and subsequent accounting judgments. In her written opinion, District Court Judge McElroy held that the alleged false and misleading statements were not actionable because, among other reasons, they were not “objectively false,” and many were opinion statements not actionable under the Supreme Court’s Omnicare opinion.
The federal matter was one of six securities class actions filed across three jurisdictions against CVS, several individual defendants, and two investment banks. Four of the cases were filed in two state courts, the product of a newly-focused effort by the securities plaintiffs’ bar, after the Supreme Court’s Cyan ruling, to bring 1933 Act claims in state court. Two additional class actions based on the same alleged conduct were brought in federal court, including this one.
The victory follows CVS’s earlier win in Rhode Island state court, where the court stayed the consolidated matters before it in light of the earlier-filed federal and state cases, representing an important win because it allowed CVS to avoid facing competing class actions across multiple state jurisdictions.
The team representing CVS Health includes Steve Farina, Mandy MacDonald, Michael Mestitz, and Elizabeth Wilson.
Click here to read the Bloomberg Law coverage about this case.