DEERFIELD (dpa-AFX) - Walgreen Co. (WAG) said that the United States District Court for the Northern District of Illinois, Eastern Division, preliminarily approved a settlement with a group of pension-fund shareholders who sued the company and its board last year.
The plaintiffs alleged the board should have prevented the events that led to Walgreen's $80 million settlement with federal authorities in June 2013 regarding the distribution of painkillers.
A hearing to determine whether the court should issue an order of final approval of the settlement has been scheduled for December 9, 2014. As per the court's order, any objections to the settlement must be filed in writing with the court by no later than November 25, 2014.
The defendants have denied and continue to deny each and every one of the claims and contentions alleged in the Action, along with all allegations of any wrongdoing or liability arising from any conduct, statements, acts or omissions alleged, or that could have been alleged in the Action or any shareholder demand relating to the events alleged in the Action.
However, Defendants have concluded that further litigation would be protracted, expensive, and distracting and that it is desirable to settle the Action upon the terms and conditions set forth in the Stipulation.
The terms of the Settlement set forth in the Stipulation include the adoption by the Company of a number of corporate governance and compliance enhancements, such as extending the term of the compliance commitments made to the Drug Enforcement Administration or the DEA and the implementation of periodic reporting of significant DEA-related matters to the Audit Committee of Walgreens' Board of Directors. The Stipulation also provides for Walgreens and/or its insurance carrier to pay Derivative Counsel's attorneys' fees and expenses in an amount not to exceed $3.50 million, subject to Court approval.
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