| Commitments and Contingencies | NOTE 16 – Commitments and Contingencies:
General
From time to time, Teva and/or its subsidiaries are subject to
claims for damages and/or equitable relief arising in the ordinary
course of business. In addition, as described below, in large part
as a result of the nature of its business, Teva is frequently
subject to litigation. Teva generally believes that it has
meritorious defenses to the actions brought against it and
vigorously pursues the defense or settlement of each such action.
Except as described below, Teva does not currently have a
reasonable basis to estimate the loss, or range of loss, that is
reasonably possible with respect to matters disclosed in this
note.
Teva records a provision in its financial statements to the extent
that it concludes that a contingent liability is probable and the
amount thereof is estimable. Based upon the status of the cases
described below, management’s assessments of the likelihood
of damages, and the advice of counsel, no provisions have been made
regarding the matters disclosed in this note, except as noted
below. Litigation outcomes and contingencies are unpredictable, and
excessive verdicts can occur. Accordingly, management’s
assessments involve complex judgments about future events and often
rely heavily on estimates and assumptions. Teva continuously
reviews the matters described below and may, from time to time,
remove previously disclosed matters that the Company has determined
no longer meet the materiality threshold for disclosure.
If one or more of such proceedings described below were to result
in final judgments against Teva, such judgments could be material
to its results of operations and cash flows in a given period. In
addition, Teva incurs significant legal fees and related expenses
in the course of defending its positions even if the facts and
circumstances of a particular litigation do not give rise to a
provision in the financial statements.
In connection with third-party agreements, Teva may under certain
circumstances be required to indemnify, and may be indemnified by,
in unspecified amounts, the parties to such agreements against
third-party claims. Among other things, Teva’s agreements
with third parties may require Teva to indemnify them, or require
them to indemnify Teva, for the costs and damages incurred in
connection with product liability claims, in specified or
unspecified amounts.
Except as otherwise noted, all of the litigation matters disclosed
below involve claims arising in the United States. Except as
otherwise noted, all third party sales figures given below are
based on IQVIA (formerly IMS Health Inc.) data.
Intellectual Property Litigation
From time to time, Teva seeks to develop generic versions of
patent-protected pharmaceuticals for sale prior to patent
expiration in various markets. In the United States, to obtain
approval for most generics prior to the expiration of the
originator’s patents, Teva must challenge the patents under
the procedures set forth in the Hatch-Waxman Act of 1984, as
amended. To the extent that Teva seeks to utilize such patent
challenge procedures, Teva is and expects to be involved in patent
litigation regarding the validity, enforceability or infringement
of the originator’s patents. Teva may also be involved in
patent litigation involving the extent to which its product or
manufacturing process techniques may infringe other originator or
third-party patents.
Additionally, depending upon a complex analysis of a variety of
legal and commercial factors, Teva may, in certain circumstances,
elect to market a generic version even though litigation is still
pending. To the extent Teva elects to proceed in this manner, it
could face substantial liability for patent infringement if the
final court decision is adverse to Teva, which could be material to
its results of operations and cash flows in a given period.
The general rule for damages in patent infringement cases in the
United States is that the patentee should be compensated by no less
than a reasonable royalty, and it may also be able in certain
circumstances to be compensated for its lost profits. The amount of
a reasonable royalty award would generally be calculated based on
the sales of Teva’s product. The amount of lost profits would
generally be based on the lost sales of the patentee’s
product. In addition, the patentee may seek consequential damages
as well as enhanced damages of up to three times the profits lost
by the patent holder for willful infringement, although courts have
typically awarded much lower multiples.
Teva is also involved in litigation regarding patents in other
countries where it does business, particularly in Europe, where
Teva has in recent years increased the number of launches of its
generic versions of branded pharmaceuticals prior to the expiration
of the innovator’s patents. The laws concerning generic
pharmaceuticals and patents differ from country to country. Damages
for patent infringement in Europe may include lost profits or a
reasonable royalty, but enhanced damages for willful infringement
are generally not available.
In July 2014, GlaxoSmithKline (“GSK”) sued Teva in
Delaware federal court for infringement of a patent expiring in
June 2015 directed to using carvedilol in a specified manner to
decrease the risk of mortality in patients with congestive heart
failure. Teva and eight other generic producers began selling their
carvedilol tablets (the generic version of GSK’s
Coreg ® pre-
In 2014, Teva Canada succeeded in its challenge of the bortezomib
(the generic equivalent of Velcade ®
Product Liability Litigation
Teva’s business inherently exposes it to potential product
liability claims. Teva maintains a program of insurance, which may
include commercial insurance, self-insurance (including direct risk
retention), or a combination of both approaches, in amounts and on
terms that it believes are reasonable and prudent in light of its
business and related risks. However, Teva sells, and will continue
to sell, pharmaceuticals that are not covered by its product
liability insurance; in addition, it may be subject to claims for
which insurance coverage is denied as well as claims that exceed
its policy limits. Product liability coverage for pharmaceutical
companies is becoming more expensive and increasingly difficult to
obtain. As a result, Teva may not be able to obtain the type and
amount of commercial insurance it desires, or any commercial
insurance on reasonable terms, in all of its markets.
Competition Matters
As part of its generic pharmaceuticals business, Teva has
challenged a number of patents covering branded pharmaceuticals,
some of which are among the most widely-prescribed and well-known
drugs on the market. Many of Teva’s patent challenges have
resulted in litigation relating to Teva’s attempts to market
generic versions of such pharmaceuticals under the federal
Hatch-Waxman Act. Some of this litigation has been resolved through
settlement agreements in which Teva obtained a license to market a
generic version of the drug, often years before the patents
expire.
Teva and its subsidiaries have increasingly been named as
defendants in cases that allege antitrust violations arising from
such settlement agreements. The plaintiffs in these cases, which
are usually direct and indirect purchasers of pharmaceutical
products, and often assert claims on behalf of classes of all
direct and indirect purchasers, typically allege that (1) Teva
received something of value from the innovator in exchange for an
agreement to delay generic entry, and (2) significant savings
could have been realized if there had been no settlement agreement
and generic competition had commenced earlier. These class action
cases seek various forms of injunctive and monetary relief,
including damages based on the difference between the brand price
and what the generic price allegedly would have been and
disgorgement of profits, which are automatically trebled under the
relevant statutes, plus attorneys’ fees and costs. The
alleged damages generally depend on the size of the branded market
and the length of the alleged delay, and can be substantial –
potentially measured in multiples of the annual brand sales –
particularly where the alleged delays are lengthy or branded drugs
with annual sales in the billions of dollars are involved.
Teva believes that its settlement agreements are lawful and serve
to increase competition, and has defended them vigorously. In
Teva’s experience to date, these cases have typically settled
for a fraction of the high end of the damages sought, although
there can be no assurance that such outcomes will continue.
In June 2013, the United States Supreme Court held, in Federal
Trade Commission v. Actavis, Inc. (the “AndroGel
case”), that a rule of reason test should be applied in
analyzing whether such settlements potentially violate the federal
antitrust laws. The Supreme Court held that a trial court must
analyze each agreement in its entirety in order to determine
whether it violates the antitrust laws. This new test has resulted
in increased scrutiny of Teva’s patent settlements,
additional action by the FTC and state and local authorities, and
an increased risk of liability in Teva’s currently pending
antitrust litigations.
In April 2006, certain subsidiaries of Teva were named in a class
action lawsuit filed in the U.S. District Court for the Eastern
District of Pennsylvania. The case alleges that the settlement
agreements entered into between Cephalon, Inc., now a Teva
subsidiary (“Cephalon”), and various generic
pharmaceutical companies in late 2005 and early 2006 to resolve
patent litigation involving certain finished modafinil products
(marketed as PROVIGIL ®
Additionally, Cephalon and Teva have reached a settlement with 48
state attorneys general, which was approved by the court on
November 7, 2016. Certain other claimants, including the State
of California, have given notices of potential claims related to
these settlement agreements. Teva has produced documents and
information in response to discovery requests issued by the
California Attorney General’s office as part of its ongoing
investigation of generic competition to PROVIGIL.
In May 2015, Cephalon entered into a consent decree with the FTC
under which the FTC dismissed its claims against Cephalon in the
FTC Modafinil Action in exchange for payment of $1.2 billion
(less set-offs
Following an investigation initiated by the European Commission in
April 2011 regarding a modafinil patent settlement in Europe, the
Commission issued a Statement of Objections in July 2017 against
both Cephalon and Teva alleging that the 2005 settlement agreement
between the parties had the object and effect of hindering the
entry of generic modafinil. Teva submitted its defense in writing
and an oral hearing was held. No final decision regarding
infringement has yet been taken by The Commission. The sales of
modafinil in the European Economic Area during the last full year
of the alleged infringement amounted to EUR 46.5 million.
In January 2009, the FTC and the State of California filed a
complaint for injunctive relief in California federal court
alleging that a September 2006 patent lawsuit settlement between
Watson and Solvay Pharmaceuticals, Inc. (“Solvay”)
relating to AndroGel ® ® ® ® ®
In December 2011, three groups of plaintiffs sued Wyeth and Teva
for alleged violations of the antitrust laws in connection with
their settlement of patent litigation involving extended release
venlafaxine (generic Effexor ® ®
In February 2012, two purported classes of direct-purchaser
plaintiffs sued GSK and Teva in New Jersey federal court for
alleged violations of the antitrust laws in connection with their
settlement of patent litigation involving lamotrigine (generic
Lamictal ® ®
In April 2013, purported classes of direct purchasers of, and end
payers for, Niaspan ® opt-out ®
In November 2013, a putative class action was filed in Pennsylvania
federal court against Actavis, Inc. and certain of its affiliates,
alleging that Watson’s 2012 patent lawsuit settlement with
Endo Pharmaceuticals Inc. relating to Lidoderm ® end-payer end-payor ® re-filing re-filed ®
Since November 2013, numerous lawsuits have been filed in various
federal courts by purported classes of end payers for, and direct
purchasers of, Aggrenox ® ® ® opt-out opt-out
Since January 2014, numerous lawsuits have been filed in the U.S.
District Court for the Southern District of New York by purported
classes of end payers for and direct purchasers of Actos ® ® ® ® ® ®
In June 2014, two groups of end payers sued AstraZeneca and Teva,
as well as Ranbaxy and Dr. Reddy’s, in the Philadelphia
Court of Common Pleas for violating the antitrust laws by entering
into settlement agreements to resolve the esomeprazole (generic
Nexium ® non-settling
In September 2014, the FTC sued AbbVie Inc. and certain of its
affiliates (“AbbVie”) and Teva in the U.S. District
Court for the Eastern District of Pennsylvania alleging that they
violated the antitrust laws when they entered into a settlement
agreement to resolve the AndroGel ® ®
Since May 2015, two lawsuits have been filed in the U.S. District
Court for the Southern District of New York by a purported class of
direct purchasers of, and a purported class of end payers for,
Namenda IR ® ®
On March 8, 2016 and April 11, 2016, certain Actavis
subsidiaries in the United Kingdom, including Auden Mckenzie
Holdings Limited, received notices from the U.K. Competition and
Markets Authority (“CMA”) that it had launched formal
investigations under Section 25 of the Competition Act of 1998
(“Competition Act”) into suspected breaches of
competition law in connection with the supply of 10mg and 20mg
hydrocortisone tablets. On December 16, 2016, the CMA issued a
statement of objections (a provisional finding of infringement of
the Competition Act) in respect of certain allegations against
Actavis UK and Allergan, which was later reissued to include
certain Auden Mckenzie entities. A response was submitted and an
oral hearing was held. On December 18, 2017, the CMA issued a
Statement of Draft Penalty Calculation. A response was submitted
and an oral hearing was held. No final decision regarding
infringement of competition law has yet been issued by the CMA. On
March 3, 2017, the CMA issued a second statement of objection
in respect of certain additional allegations (relating to the same
products and covering part of the same time period as for the first
statement of objections) against Actavis UK, Allergan, and a number
of other companies, which was later reissued to include certain
Auden Mckenzie entities. A response was submitted and an oral
hearing was held. On January 9, 2017, Teva completed the sale
of Actavis UK to Accord Healthcare Limited, pursuant to which Teva
will indemnify Accord Healthcare for fines imposed by the CMA
and/or damages awarded by a court on Actavis UK as a result of the
investigations in respect of conduct prior to the closing date of
the sale. In the event of any such fines or damages, Teva expects
to assert claims, including claims for breach of warranty, against
the sellers of Auden Mckenzie. The terms of the purchase agreement
may preclude a full recovery by Teva. A liability for this matter
has been recorded in purchase accounting related to the acquisition
of Actavis Generics. Further to our Master Purchase Agreement with
Allergan whereby Teva agreed to indemnify Allergan for liabilities
related to acquired assets, Teva agreed with Allergan to settle and
release Teva’s indemnity claim and Allergan’s potential
losses arising from the CMA in connection with this matter,
pursuant to the agreement the parties entered into on
January 31, 2018. See note 3.
In November 2016, three putative indirect purchaser class actions
were filed in federal courts in Wisconsin, Massachusetts and
Florida against Shire U.S., Inc. and Shire LLC (collectively,
“Shire”) and Actavis, alleging that Shire’s 2013
patent litigation settlement with Actavis related to the ADHD drug
Intuniv ® ®
Government Investigations and Litigation Relating to Pricing and
Marketing
Teva is involved in government investigations and litigation
arising from the marketing and promotion of its pharmaceutical
products in the United States. Many of these investigations
originate through what are known as qui
tam
A number of state attorneys general have filed various actions
against Teva and/or certain of its subsidiaries, including certain
Actavis subsidiaries, relating to reimbursements or drug price
reporting under Medicaid or other programs. Such price reporting is
alleged to have caused governments and others to pay inflated
reimbursements for covered drugs. Teva and its subsidiaries have
reached settlements in most of these cases, and remain parties to
active litigation in Illinois. The Actavis subsidiaries remain
parties to active litigation in Illinois and Utah. A provision for
the cases has been included in the financial statements. Trial in
the Illinois case against Teva concluded in the fourth quarter of
2013, and post-trial briefing was submitted. On June 28, 2017,
after several years, the court issued a Memorandum Order After
Trial finding liability against Teva, but reserved its decision on
damages. Teva denies any liability and sought reconsideration of
the order, which was denied. A hearing on damages is scheduled for
August 8, 2018. The State of Illinois is seeking approximately
$90 million in compensatory damages. Any such damages
ultimately awarded by the court are subject to automatic trebling.
In addition, the state is seeking statutory penalties ranging from
$362 million to approximately $1.2 billion. Teva will
continue to argue that any damages and penalties should be
significantly less than the amount sought by the state. In August
2013, in the Mississippi case against Watson, the court ruled in
favor of the state, awarding $12.4 million in compensatory
damages and civil penalties. In March 2014, the court awarded the
state an additional $17.9 million in punitive damages. A
provision for these amounts has been included in the financial
statements. Watson appealed both the original and the punitive
damage awards. On January 11, 2018, the Mississippi Supreme
Court affirmed the judgment in favor of the State of Mississippi
and against Watson in all respects. On February 9, 2018, the
judgment was fully satisfied and on February 16, 2018, the
trial court discharged the appeal bond fully concluding this
matter. In Utah, claims against Watson that were dismissed in their
entirety by the trial court are now on appeal.
Several qui
tam
In January 2014, Teva received a civil investigative demand from
the U.S. Attorney for the Southern District of New York seeking
documents and information from January 1, 2006 related to
sales, marketing and promotion of COPAXONE and AZILECT, focusing on
educational and speaker programs. The demand states that the
government is investigating possible civil violations of the
federal False Claims Act. In March 2015, the docket in this matter
and a False Claims Act civil qui tam complaint concerning this
matter were unsealed by the court, which revealed that the U.S.
Attorney had notified the court in November 2014 that it had
declined to intervene in and proceed with the lawsuit. The qui tam
relators, however, are moving forward with the lawsuit. In June
2015, Teva filed motions to dismiss the complaint. In February
2016, the court stayed its decision on the relators’ claims
based on state and local laws, denied Teva’s motions to
dismiss the False Claims Act claims, and instructed the relators to
amend their complaint with additional information. In March 2016,
the relators filed an amended complaint, which Teva answered in
April 2016. The parties are currently engaged in discovery.
Beginning in May 2014 various complaints have been filed with
respect to opioid sales and distribution against various Teva
affiliates, along with several other pharmaceutical companies, by a
number of cities, counties, states and agencies across the country.
There are actions currently pending against Teva and its affiliates
that have been brought by various states, subdivisions and state
agencies in both State and Federal Courts. Most of the Federal
cases have been consolidated into a multidistrict litigation in the
Northern District of Ohio. In addition to the complaints filed by
states, state agencies and political subdivisions, private class
action lawsuits have been filed in Arkansas, Massachusetts, Ohio
and Pennsylvania. Several counties in various states and the State
of Delaware have commenced an action against Anda, Inc. (and other
distributor and manufacturer defendants) alleging that Anda, Inc.
failed to develop and implement systems sufficient to identify
suspicious orders of opioid products and prevent the diversion of
such products to individuals who used them for other than
legitimate medical purposes. The complaints, asserting claims under
similar provisions of different state law, generally contend that
the defendants allegedly engaged in improper marketing and
distribution of opioids, including ACTIQ ®
On June 21, 2016, Teva USA received a subpoena from the
Antitrust Division of the DOJ seeking documents and other
information relating to the marketing and pricing of certain of
Teva USA’s generic products and communications with
competitors about such products. Actavis received a similar
subpoena in June 2015. On July 12, 2016, Teva USA received a
subpoena from the Connecticut Attorney General seeking documents
and other information relating to potential state antitrust law
violations. Actavis has also received a similar subpoena from the
Connecticut Attorney General. Teva and Actavis are cooperating
fully with these subpoenas.
On December 15, 2016, a civil action was brought by the
attorneys general of twenty states against Teva USA and several
other companies asserting claims under federal antitrust law
(specifically, section 1 of the Sherman Act) alleging price fixing
of generic products in United States. An amended complaint was
filed on March 1, 2017 adding twenty additional states to the
named plaintiffs and adding supplemental state law claims. The
states seek a finding that the defendants’ actions violated
federal antitrust law, and state antitrust and consumer protection
laws, as well as injunctive relief, disgorgement, damages on behalf
of various state and governmental entities and consumers, civil
penalties and costs. On August 3, 2017, the Judicial Panel on
Multidistrict Litigation (“JPML”) transferred this
action to the generic drug multidistrict litigation pending in
federal court in Pennsylvania, which is discussed in greater detail
below. On July 17, 2017, a new complaint was filed in the
District Court of Connecticut on behalf of four additional states
– Arkansas, Missouri, New Mexico and West Virginia, as well
as the District of Columbia. These plaintiffs were not previously
party to the State Attorney General action that commenced in
December 2016. This complaint, which the JPML has also transferred
to the generic drug multidistrict litigation discussed below, makes
the same factual allegations and claims that are at issue in the
earlier State Attorneys General complaint. On October 31, 2017
the attorneys general of 45 states plus Puerto Rico and the
District of Columbia filed a motion for leave to file an amended
complaint in this action. The proposed amended complaint names
Actavis as a defendant as well as Teva, and adds new allegations
and claims to those appearing in the prior complaints. Defendants
have opposed the motion.
Beginning on March 2, 2016, numerous complaints have been
filed in the United States on behalf of putative classes of direct
and indirect purchasers of several generic drug products, as well
as several individual direct
purchaser opt-out non-merits
On March 21, 2017, Teva received a subpoena from the U.S.
Attorney’s office in Boston, Massachusetts requesting
documents related to Teva’s donations to patient assistance
programs. Teva is cooperating fully in responding to the
subpoena.
For several years, Teva had conducted a voluntary worldwide
investigation into business practices that may have implications
under the U.S. Foreign Corrupt Practices Act (“FCPA”),
following the receipt, beginning in 2012, of subpoenas and informal
document requests from the SEC and the DOJ with respect to
compliance with the FCPA in certain countries. In December 2016,
Teva reached a resolution with the SEC and DOJ to fully resolve
these FCPA matters. The resolution, which relates to conduct in
Russia, Mexico and Ukraine from 2007 to 2013, provides for
penalties of approximately $519 million (reserved in the
financial statements in the third quarter of 2016), which includes
a fine, disgorgement and prejudgment interest; a three-year
deferred prosecution agreement for Teva; a guilty plea by
Teva’s Russian subsidiary to criminal charges of violations
of the anti-bribery provisions of the FCPA; consent to entry of a
final judgment against Teva settling civil claims of violations of
the anti-bribery, internal controls and books and records
provisions of the FCPA; and the retention of an independent
compliance monitor for a period of three years. The SEC civil
consent and DOJ deferred prosecution agreement have each obtained
court approval.
Following the resolution, Teva has had requests for documents and
information from various Russian government entities. In December
2016, Teva was informed by Israeli authorities that they had
initiated an investigation into the conduct that was the subject of
the FCPA investigation and which resulted in the above-mentioned
resolution with the SEC and DOJ. On January 14, 2018, Teva and
the Government of Israel entered into an arrangement for the
Contingent Cessation of Proceedings pursuant to the Israeli
Securities Law that ends the investigation into such conduct
against the Company and provides for a payment of 75 million
New Israeli Shekels (approximately $22 million).
Shareholder Litigation
On November 6, 2016 and December 27, 2016, two putative
securities class actions were filed in the U.S. District Court for
the Central District of California against Teva and certain of its
current and former officers. After those two lawsuits were
consolidated and transferred to the U.S. District Court for the
District of Connecticut, the court appointed the Ontario
Teachers’ Pension Plan Board as lead plaintiff. The lead
plaintiff then filed a consolidated amended complaint purportedly
on behalf of purchasers of Teva’s securities between
February 6, 2014 and August 3, 2017. The consolidated
complaint seeks unspecified damages, legal fees, interest, and
costs, and it asserts that Teva and certain of its current and
former officers and directors violated the federal securities laws
and Israeli securities laws in connection with Teva’s alleged
failure to disclose Teva’s participation in an alleged
anticompetitive scheme to fix prices and allocate markets for
generic drugs in the United States. On December 1, 2017, Teva
and the current and former officer and director defendants filed
motions to dismiss the consolidated amended complaint, with
prejudice. On April 3, 2017, the Court granted the motions to
dismiss without prejudice. A second amended complaint is expected
with renewed dismissal briefing.
On July 17, 2017, a lawsuit was filed in the U.S. District
Court for the Southern District of Ohio derivatively on behalf of
the Teva Employee Stock Purchase Plan, and alternatively as a
putative class action lawsuit on behalf of individuals who
purchased Teva stock through that plan. That lawsuit seeks
unspecified damages, legal fees, interest and costs. The complaint
alleges that Teva failed to maintain adequate financial controls
based on the facts underpinning Teva’s FCPA deferred
prosecution agreement, and also based on allegations substantially
similar to those in the putative class action securities lawsuit
pending in U.S. District Court for the District of Connecticut,
discussed above. On November 29, 2017, the Court granted
Teva’s motion to transfer the litigation to the U.S. District
Court for the District of Connecticut where the putative class
action securities lawsuit is pending. On December 29, 2017,
the parties jointly moved to stay the case pending resolution of
the motions to dismiss filed in the consolidated putative
securities class action described above.
On August 3, 2017, a securities lawsuit was filed in the U.S.
District Court for the District of Connecticut by OZ ELS Master
Fund, Ltd., OZ Special Funding, L.P, OZ Enhanced Master Fund, Ltd.,
Gordel Capital Limited, OZ Global Equity Opportunities Master Fund,
Ltd., OZ Master Fund, Ltd., and OZ Global Special Investments
Master Fund L.P. The complaint asserts that Teva and certain of its
current and former officers violated the federal securities laws in
connection with Teva’s alleged failure to disclose
Teva’s participation in an alleged anticompetitive scheme to
fix prices and allocate markets for generic drugs in the United
States. On August 30, 2017, the court entered an order
deferring all deadlines pending the resolution of the motions to
dismiss filed in the consolidated putative securities class action
described above.
On August 21, 2017, a putative class action securities lawsuit
was filed by Elliot Grodko in the U.S. District Court for the
Eastern District of Pennsylvania on behalf of purchasers of
Teva’s securities between November 15, 2016 and
August 2, 2017 seeking unspecified damages, legal fees,
interest, and costs. The complaint alleged that Teva and certain of
its current and former officers violated the federal securities
laws and Israeli securities laws by making false and misleading
statements in connection with Teva’s acquisition and
integration of Actavis Generics. On April 10, 2018, the Court
granted Teva’s motion to transfer this action to the District
of Connecticut where the Ontario Teachers securities litigation is
currently pending.
On August 30, 2017, a putative securities class action was
filed by Barry Baker in the U.S. District Court for the Eastern
District of Pennsylvania on behalf of purchasers of Teva’s
securities between November 15, 2016 and August 2, 2017
seeking unspecified damages, legal fees, interest, and costs. The
complaint alleges that Teva and certain officers violated the
federal securities laws by making false and misleading statements
in connection with Teva’s acquisition and integration of
Actavis Generics. On November 1, 2017, the Court consolidated
the Baker case with the Grodko case, discussed above. On
April 10, 2018, the Court granted Teva’s motion to
transfer this action to the District of Connecticut where the
Ontario Teachers securities litigation is currently pending.
Motions to approve derivative actions against certain past and
present directors and officers have been filed in Israel with
respect to alleged negligence and recklessness with respect to the
acquisition of the Rimsa business and the acquisition of Actavis
Generics. Motions for document disclosure prior to initiating
derivatives were filed with respect to dividend distribution and
executive compensation. Motions to approve securities class actions
against Teva and certain of its current and former directors and
officers were filed in Israel with allegations regarding proper
disclosure of the above-mentioned pricing investigation as well as
lack of disclosure of negative developments in the generic sector
and erosion of the prices of Teva’s products as were
presented in the second quarter financial reporting of Teva. Other
motions were filed in Israel to approve a derivative action,
discovery and a class action related to alleged claims regarding
Teva’s above-mentioned FCPA resolution with the SEC and
DOJ.
Environmental Matters
Teva or its subsidiaries are party to a number of environmental
proceedings, or have received claims, including under the federal
Superfund law or other federal, provincial or state and local laws
imposing liability for alleged noncompliance, or for the
investigation and remediation of releases of hazardous substances
and for natural resource damages. Many of these proceedings and
claims seek to require the generators of hazardous wastes disposed
of at a third party-owned site, or the party responsible for a
release of hazardous substances that impacted a site, to
investigate and cleanup the site or to pay or reimburse others for
such activities, including for oversight by governmental
authorities and any related damages to natural reso |
