DRL’s Chairman, COO added as defendants in US lawsuit

The lawsuit filed at the District Court for New Jersey seeks damages to compensate the class of investors for a ‘purported decline’ in the company’s share price allegedly caused by the misstatements or omissions

Dr Reddy’s Laboratories (DRL) said its Chairman Satish Reddy, COO Abhijit Mukherjee and US subsidiary have been included as defendants in the class action lawsuit filed against it by investors. Last year in August, the company had said “a law firm representing a purported investor in the company filed a purported class action lawsuit against the company, its CEO and CFO in the US District Court for the District of New Jersey alleging violation of the US federal securities laws.”

Later on in November, the company said it was served a securities class action lawsuit in the US by the lead plaintiff. “We would like to inform you that an amended complaint has been filed by the lead plaintiff, wherein our Chairman, COO and Dr Reddy’s Laboratories, a wholly-owned subsidiary in the US have been added as defendants,” Dr Reddy’s Labs said in a BSE filing.

As intimated earlier, the company believes that the asserted claims are without merit and intends to vigorously defend itself against the allegations, it added. The lawsuit filed at the District Court for New Jersey seeks damages to compensate the class of investors for a ‘purported decline’ in the company’s share price allegedly caused by the misstatements or omissions. The company had stated that the lawsuit represented a class of investors who purchased or otherwise acquired the company’s publicly traded shares on the New York Stock Exchange between June 17, 2015 through August 10, 2017.

The lawsuit alleged that the company made materially false and/or misleading statements or omissions in connection with its corporate quality system, it had added. The allegation is specifically in connection with a warning letter from the US FDA dated November 6, 2015 and a letter from Regierung von Oberbayern in Germany, dated August 10, 2017, Dr Reddy’s had said.