WELCOME TO THE OMNICARE SECURITIES LITIGATION SETTLEMENT WEBSITE

This website has been established to provide general information related to the proposed settlement (the "Settlement") of the action captioned Indiana State District Council of Laborers and Hod Carriers Pension and Welfare Fund v. Omnicare, Inc., et al., Civil Action No. 2:06-cv-00026-WOB-CJS (the "Litigation"). The capitalized terms used on this website, and not otherwise defined, shall have the same meanings ascribed to them in the Stipulation of Settlement (the "Stipulation") dated February 5, 2019, which can be found and downloaded by clicking on the Case Documents tab above.

CASE BACKGROUND

The Litigation is currently pending in the United States District Court for the Eastern District of Kentucky, Northern Division (the “Court”), before the Honorable William O. Bertelsman. The entities that lead the Litigation, Lead Plaintiff Laborers District Council Construction Industry Pension Fund (“Laborers Pension Fund”) and named plaintiff Cement Masons Local 526 Combined Funds (“Cement Masons”) are collectively referred to as the Plaintiffs.  The company and individuals, Omnicare, Inc. (“Omnicare” or the “Company”), Joel F. Gemunder, David W. Froesel, Jr., Cheryl D. Hodges, and Sandra E. Laney, being sued are called the Defendants. The Court appointed the law firm of Robbins Geller Rudman & Dowd LLP as Lead Counsel to represent the Settlement Class.

Plaintiffs allege that Omnicare and several of its senior executives, former Chief Executive Officer Joel F. Gemunder, former Chief Financial Officer David W. Froesel, Jr., former Secretary Cheryl D. Hodges, and former Director Sandra E. Laney, violated Section 11 of the Securities Act of 1933 (“Securities Act”) by making false and misleading statements in the Registration Statement and Prospectus issued in connection with Omnicare’s Offering of 12,825,000 shares on or about December 12, 2005. Defendants have denied all allegations of wrongdoing. In 2015, Omnicare was acquired by CVS Health Corporation in a transaction valued at $12.7 billion. In connection with the transaction, Omnicare’s shareholders received $98 per share in cash. As a result of the transaction, Omnicare no longer has any public shareholders.

The initial complaint in this action was filed on February 2, 2006, and Laborers Pension Fund was appointed lead plaintiff on May 22, 2006. The original complaint asserted claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (“Exchange Act”). After being granted leave to amend the Consolidated Complaint, Plaintiffs’ First Amended Consolidated Complaint (“FAC”) – with Cement Masons added as a named plaintiff – was filed on January 26, 2007. In addition to the Exchange Act claims, the FAC also for the first time asserted a claim for violation of Section 11 of the Securities Act.

On October 12, 2007, Defendants’ motion to dismiss the FAC in its entirety was granted. Plaintiffs subsequently appealed the dismissal order, and on October 21, 2009, the Sixth Circuit affirmed the District Court’s dismissal of the Exchange Act claims, but reversed and remanded with respect to the Section 11 claim. See Ind. State Dist. Council of Laborers v. Omnicare, Inc., 583 F.3d 935 (6th Cir. 2009) (“Omnicare I”). On July 14, 2011, Plaintiffs filed their Second Amended Consolidated Complaint (“SAC”). The lone claim asserted in the SAC, which was later dismissed on February 13, 2012, was a claim under Section 11. Plaintiffs appealed the dismissal of the SAC, and, on May 28, 2013, the Sixth Circuit again partially reversed the dismissal order. See Ind. State Dist. Council v. Omnicare, Inc., 719 F.3d 498 (6th Cir. 2013) (“Omnicare II”). After the Omnicare II decision, Defendants sought and were granted the issuance of a writ of certiorari by the United States Supreme Court. See Omnicare, Inc. v. Laborers Dist. Council Constr. Indus. Pension Fund, 134 S. Ct. 1490 (2014). Following briefing, oral argument was held before the Supreme Court on November 3, 2014. On March 24, 2015, the Supreme Court delivered its opinion, reversing and remanding Omnicare II to address the Court’s newly announced standard for pleading actionable false and/or misleading opinions pursuant to Section 11. See Omnicare, Inc. v. Laborers Dist. Council Constr. Indus. Pension Fund, 135 S. Ct. 1318 (2015).

After remand to the Sixth Circuit, and then eventually to the district court, Plaintiffs filed their Third Amended Consolidated Complaint (“TAC”). The TAC, which was likewise limited to a claim for violation of Section 11, expressly disclaimed the existence of any fraudulent statement by Defendants in connection with Omnicare’s December 12, 2005 Offering. Defendants moved to dismiss the TAC. The Court held a hearing on August 23, 2016, and in a subsequent order filed the next day, denied Defendants’ motion to dismiss. Discovery in the case commenced promptly thereafter.

By the time the parties agreed to settle this matter, the parties had completed substantial non-expert discovery, including production and review of over 964,510 documents (4,098,000 pages), and nine fact depositions (with another 15 depositions scheduled to occur). The parties had also completed class certification discovery, including five related depositions, and had completed briefing on Plaintiffs’ motion for class certification. Also pending before the Court when a settlement was achieved was Plaintiffs’ motion to compel discovery from certain of Omnicare’s outside counsel during the relevant time frame, which motion was fully briefed by July 16, 2018. The parties had also engaged various expert witnesses who had undertaken substantial work in connection with both class certification and merits issues.

On June 8, 2017, the parties participated in a mediation session with the assistance of the Honorable Layn R. Phillips (Ret.). That session did not result in a settlement. Thereafter, on September 24, 2018, the parties participated in a second mediation session with the assistance of Magistrate Judge J. Gregory Wehrman.

In advance of both mediation sessions, the parties submitted detailed descriptions of their case and defenses, and voluminous collections of the evidence in support of their arguments. The parties, with the assistance of Judge Phillips and then Magistrate Judge Wehrman, engaged in protracted negotiations before reaching agreement to resolve this matter upon the terms set forth in the Stipulation.

Defendants deny each and all of the claims and contentions of wrongdoing alleged by Plaintiffs in the Litigation. Defendants contend that they did not make any materially false or misleading statements and that they disclosed all material information required to be disclosed by the federal securities laws. Defendants also contend that any losses suffered by members of the Settlement Class were not caused by any allegedly false or misleading statements by Defendants.

In exchange for the Settlement and the release of the Released Claims as well as dismissal of the Litigation, Defendants have agreed that a payment of $20 million will be made by Defendants (or on their behalf) to be divided, after taxes, fees, and expenses, pro rata, pursuant to the Plan of Allocation, among all Settlement Class Members who send in a valid Proof of Claim. 

The Settlement Class includes all Persons who purchased or otherwise acquired the common stock of Omnicare pursuant and/or traceable to the Registration Statement and Prospectus for the Company’s December 12, 2005 Offering, except those Persons and entities that are excluded. Excluded from the Settlement Class are Defendants, the officers and directors of Omnicare at the time of the Offering, members of their immediate families and their legal representatives, heirs, successors, or assigns of any entity in which Defendants have or had a controlling interest. Also excluded from the Settlement Class are those Persons who timely and validly request exclusion from the Settlement Class pursuant to this Notice.

Although the information in this website is intended to assist you, it does not replace the information contained in the relevant case documents found on the Case Documents tab above. We recommend that you read the relevant case documents carefully and in their entirety.

YOUR LEGAL RIGHTS AND OPTIONS IN THIS SETTLEMENT

IMPORTANT DATES AND DEADLINES