A class action lawsuit was filed on behalf of shareholders who purchased the securities of Caraco Pharmaceutical Laboratories (CPD) between May 29, 2008 and June 25, 2009.
Shareholders filed the lawsuit in the Eastern District of Michigan against Caraco, Daniel H. Movens, Caraco’s Chief Executive Officer, and Mukul Rathi, Caraco’s Chief Financial Officer.
The complaint alleges the defendants violated federal securities laws by misrepresenting and failing to disclose material facts, including:
- Caraco failed to meet the FDA’s Good Manufacturing Practice requirements;
- Caraco failed to take corrective measures at its manufacturing facilities to comply with FDA requirements;
- Caraco jeopardized FDA approval of pending new drug applications by failing to fix repeated FDA violations; and
- Because of Caraco’s misconduct, it would have to recall certain of its products.
On June 25, 2009, the FDA announced U.S. Marshalls had seized Caraco’s drug products from several facilities because Caraco failed to meet the FDA’s manufacturing requirements. Following the FDA’s announcement, Caraco’s stock price fell significantly.
For more information or to join this class action, please fill out our contact form.