A class action lawsuit has been filed in U.S. District Court for the District of Minnesota on behalf of those who purchased or acquired St. Jude Medical Inc securities between December 15, 2010 and April 4, 2012. The class action alleges the company failed to disclose the full range of problems regarding the recalled, defective, Riata and Riata ST defibrillator leads, which have been linked to short circuiting and protruding wires.
According to the lawsuit, the defendants “failed to disclose that the Riata and Riata ST were also associated with short circuits unrelated to the protruding wires. Although less frequent than the protrusions, the short circuits were much more dangerous. Second, defendants failed to disclose that two other leads sold by the company, the QuickSite and QuickFlex Left -Ventricular leads, suffered from the same protruding wires that plagued the Riata and Riata ST.”
The lawsuit also says, “Subsequently, on March 27, 2012, The New York Times disclosed the results of an analysis performed by an independent researcher, Dr. Robert Hauser, which indicated that the Riata and Riata ST caused short circuits. Defendants vehemently challenged these findings, thus maintaining the artificial inflation in St. Jude’s stock.”
“On April 4, 2012, defendants finally disclosed that the QuickSite and QuickFlex Left-Ventricular leads also suffered from the same protruding wire defect as the Riata and Riata ST. Sales of the QuickSite and QuickFlex Left-Ventricular leads were discontinued.
“As a result of these disclosures, the closing price of St. Jude’s stock dropped from $43.80 to $38.91 over three trading days, a decline of over 11%. This decrease was a result of the artificial inflation caused by defendants’ misleading statements coming out of the price.”
The class action lawsuit seeks damages on behalf of all class members.