Federal Abiomed inquiry triggers class action lawsuit
A federal investigation into Abiomed's ($ABMD) marketing and labeling practices for the Impella 2.5 heart pump continues to produce fallout for the beleaguered company. The latest: Two individuals filed what appears to be the first class action lawsuit in the case on Nov. 16 in the U.S. District Court in Massachusetts.
Both Michael Minogue, Abiomed's chairman, president and CEO, and Robert Bowen, the chief financial officer, are named in the lawsuit, which accuses them of violating federal securities laws regarding FDA-related marketing and labeling disclosures for Impella. (They want a jury trial, of course.)
Abiomed said in a statement announcing the lawsuit that it would "vigorously defend itself against the allegations," which it reviewed and determined "are without merit." No surprise there, but the company is clearly circling the wagons this month after the U.S. Attorney's office announced its investigation into the very same issue. Another law firm--the Law Offices of Howard G. Smith--disclosed it was looking into the issue as well, "on behalf of shareholders," but an actual lawsuit ups the ante here.
Abiomed's stock nearly hit the $20 mark at the end of October, but plunged to just more than $13 after news of the federal investigation hit. Abiomed traded in the low $14 range late morning on Nov. 19.
- read the release