On Tuesday, plaintiff Elaine Wang filed suit against Arena Pharmaceuticals, Inc and various members of its corporate board in the Southern District of New York. The plaintiff is alleging that Arena Pharmaceuticals violated securities regulations through its filings with the Securities & Exchange Commission.
Arena Pharmaceuticals is a “biopharmaceutical company that creates novel medicines with pharmacology and pharmacokinetics to patients worldwide.”
The complaint states that the defendant has violated the “Exchange Act by causing a materially incomplete and misleading Preliminarily Proxy statement.”
The plaintiff alleges that the defendant’s proxy statement recommends to shareholders that they should vote in favor of merging Pfizer Inc’s subsidiary company, Antioch Merger Sub, Inc with Arena Pharmaceuticals. Pfizer announced that they would buy each share of Arena Pharmaceuticals for $100, for an approximate total of $6.7 billion. Yet the plaintiffs asserts that vital information had been omitted that would give shareholders a true assessment of the acquisition.
Some of the information the plaintiff alleges that the proxy statement fails to include “information concerning the company’s financial forecasts and financials analyses conducted by the financial advisors of the company, Evercore Group L.L.C and Guggenheim Partners, LLC” which are viewed as unbiased in their assessments.
The plaintiff also alleges that the specific information that the proxy statement fails to “provide line items used to calculate the metrics and/ or a reconciliation of the non-GAAP metrics to their most comparable GAAP measures.”
The defendant is facing two counts, violations of Section 14(a) and Section 20(a) of the Exchange Act.
The plaintiff is being represented by Melwani & Chan LLP