Final OK Given to $110M CVS Settlement
Boston, Afederal judge gave final approval to the $110 million settlement of a shareholders’ lawsuit accusing CVS Corp. of making misleading statements to artificially raise its stock price.
The lawsuit, which also accused the retailer of delayed accounting for merchandise discounts, was filed in 2001 in U.S. District Court in Boston.
Shareholders also alleged that CVS chief executive Thomas Ryan delayed reporting the company’s plans to close 200 underperforming stores and sold more than 95,000 shares of CVS stock before telling investors that the company’s second quarter and full-year earnings would fall below projections in 2001.
CVS had no immediate comment on the settlement. When CVS filed the proposed settlement in June, it said the shareholders’ allegations were unfounded and that it agreed to the settlement “purely as a business decision” to avoid diverting resources for a trial.