Aug 8 The federal judge in California overseeing Allergan Inc's insider trading lawsuit against Valeant Pharmaceuticals and activist investor William Ackman has set an Aug. 20 hearing date to decide on a fast-track schedule for the case, according to court documents.
Allergan, fighting a hostile takeover by Valeant and Ackman's Pershing Square Capital Management hedge fund, filed the lawsuit on Aug. 1. The Botox maker said in the complaint that Valeant and Ackman violated securities laws on tender offers when they teamed up on a $48 billion cash and stock offer.
The case could have implications for efforts by Pershing Square, which owns nearly 10 percent of Allergan's shares, and Valeant to call and hold a meeting of Allergan shareholders to vote in new board members.
Under Allergan's bylaws, Ackman needs 25 percent of shareholders to ask the company to call a meeting. Pershing Square has been gathering investor support and has said that it plans to submit the request in mid-August.
Those bylaws also say that Allergan cannot accept a special meeting request if there is a violation of securities rules, such as insider trading.
Ackman and Valeant offered to buy Allergan on April 22 and laid out a plan for spending cuts at the company. It later launched a hostile tender offer for its shares.
Allergan has mounted a defense that includes its own cost-cutting plans, and has urged shareholders not to support the meeting or the deal.
Judge David Carter in U.S. District Court, Central District of California, said in the documents that he would consider Allergan's request for an expedited schedule at a hearing rather than outside of "normal procedures," as requested. (Reporting by Caroline Humer; Editing by Jonathan Oatis)