A class action lawsuit was filed against Merck & Company on behalf of participants and beneficiaries of the Merck & Co., Inc. Savings and Security Plan and the Employee Stock Purchase and Security Plan, the law firm Scott + Scott, LLC said in a press release on Wednesday.
The lawsuit, filed in U.S. District Court for the District of New Jersey, alleges that defendants Merck & Co., Inc. and other Plan fiduciaries breached their fiduciary duties under Employee Retirement Income Security Act by, among other things: (1) failing to properly manage the Plans’ assets by imprudently investing a significant amount of the Plans’ assets in Merck stock; (2) failing to provide complete and accurate information to participants and beneficiaries; (3) failing to monitor those Defendants who were charged with managing the Plans and their assets; and (4) failing to avoid conflicts of interest with respect to the Plans.
Merck’s stock price slid on Monday after it disclosed, in a quarterly report, that the Justice Department had launched a criminal investigation related to the Company’s research, marketing and selling activities with respect to Vioxx, and the Securities and Exchange Commission informed Merck that it has begun an informal inquiry over Vioxx.
Merck’s CEO Raymond Gilmartin and FDA officials must testify before Congress on November 18, 2004 over Vioxx.
On September 30, 2004, Merck withdrew Vioxx from all worldwide markets after a study confirmed that it increased the risk of heart attacks and strokes in patients taking it longer than 18 months.
After the drug had been withdrawn, the Wall Street Journal reported that internal company emails and memos showed that Merck was aware of the problems with Vioxx as early as March 2000, over 4 years before the drug was withdrawn.
(via Business Wire)
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