NEW YORK, Dec. 10, 2012 (GLOBE NEWSWIRE) -- Labaton Sucharow LLP filed a class action lawsuit on December 10, 2012 in the U.S. District Court for the District of Minnesota. The lawsuit was filed on behalf of persons or entities who purchased or otherwise acquired the publicly-traded common stock of St. Jude Medical, Inc. ("St. Jude" or the "Company") (NYSE:STJ) between October 19, 2011 and November 20, 2012, inclusive (the "Class Period").
The action charges St. Jude and certain of its officers with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. The Complaint alleges that, throughout the Class Period, the Company made false and misleading statements, and concealed material information relating to the safety, durability, and manufacturing processes of the Company's cardiac rhythm management lead wires marketed under the name "Durata."
St. Jude, a global medical device company, manufactures and markets cardiac rhythm management systems, which rely on insulated leads, including Durata leads. The complaint alleges that, during the Class Period, St. Jude concealed from shareholders that: (1) Durata leads were subject to the same or similar design flaws found in the Company's earlier generation of leads; (2) the Company's design, manufacturing, testing, and quality control processes for leads, including Durata leads, were flawed by such significant deficiencies that the Company's leads presented a material risk to patients and would not be a commercial success; and (3) as a result of the foregoing, St. Jude lacked a reasonable basis to tout the testing and manufacturing processes underlying Durata leads and its proprietary insulation material called "Optim," to characterize the Durata leads as an improvement over its previous generation of leads, and to project that Durata leads would be a commercial success.
The truth about St. Jude and its Durata leads was revealed through a series of disclosures. Prior to the markets' open on October 17, 2012, St. Jude hosted a conference call to discuss its financial results for the third quarter of 2012. During this call, the Company warned investors of possible advisory action by the U.S. Food and Drug Administration (the "FDA") as a result of a then-ongoing inspection of the Company's Sylmar, California facility. In reaction to this news, St. Jude's stock dropped $2.09 per share, or 4.87 percent, to close at $40.85 per share following trading on October 17, 2012.
On October 24, 2012, after the markets' close, St. Jude filed a Current Report on Form 8-K with the U.S. Securities and Exchange Commission about the FDA's inspection of the Sylmar facility that included a heavily redacted version of an FDA report on the facility. Describing the results of the inspection, the Company emphasized that "none of the observations identified a specific issue regarding the clinical or field performance of any particular device." On this news, St. Jude's stock price fell by $1.44 per share, or 3.63 percent, to close at $38.27 per share on elevated trading volume during the following trading session on October 25, 2012.
Finally, after the markets' close on November 20, 2012, the FDA released its own version of the Sylmar inspection results, which—unlike the version released by the Company—did not redact the names of the product in question in each observation. The FDA's report made clear that the numerous concerns raised by the FDA's inspection almost universally pertained to the design, production, and quality control for the manufacturing process of Durata leads. In reaction to this news, St. Jude's stock price fell $4.34 per share, or 12.15 percent, to close at $31.37 per share on November 21, 2012, on extremely heavy trading volume.
If you are a member of this Class you can view a copy of the complaint and join this class action online at http://www.labaton.com/en/cases/Newly-Filed-Cases.cfm.
If you purchased St. Jude common stock during the Class Period, you may be able to seek appointment as Lead Plaintiff. Lead Plaintiff motion papers must be filed with the U.S. District Court for the District of Minnesota no later than February 5, 2013. A lead plaintiff is a court-appointed representative for absent Class members. You do not need to seek appointment as lead plaintiff to share in any Class recovery in this action. If you are a Class member and there is a recovery for the Class, you can share in that recovery as an absent Class member. You may retain counsel of your choice to represent you in this action.
If you would like to consider serving as lead plaintiff or have any questions about the lawsuit, you may contact Rachel A. Avan, Esq. of Labaton Sucharow LLP, at (888) 753-2796 or (212) 907-0709, or via email at ravan@labaton.com.
Labaton Sucharow LLP, with offices in New York, New York and Wilmington, Delaware, is one of the country's premier law firms representing institutional investors in class action and complex securities litigation, as well as consumers and businesses in class actions seeking to recover damages for anticompetitive practices. The Firm has been a champion of investor and consumer rights for nearly 50 years, seeking recovery of current losses and necessary governance reforms to protect investors and consumers. Labaton Sucharow has been recognized for its excellence by the courts and its peers. More information about Labaton Sucharow is available at www.labaton.com.