Tuesday, 31 May 2016
Last updated 3 days ago
May 15 2013 | 1:15pm ET
SAC Capital Advisors should pay Elan Corp. shareholders at least $685.6 million for losses suffered on the allegedly illegal trades made by the hedge fund in the pharmaceutical company's stock.
Elan shareholders, who first sued SAC in January, demanded at least $549.2 million in illicit profits in a consolidated complaint filed on Monday. The group, which is seeking class-action status, is also seeking $396 million in prejudgment interest. The disgorgement sought would be offset by $259.7 million from SAC's settlement with the Securities and Exchange Commission.
Elan is one of two companies that former SAC portfolio manager Mathew Martoma is alleged to have illegally traded while at the hedge fund. Martoma was charged in November with getting confidential information about Alzheimer's drug trials and using it to trade in Elan and Wyeth LLC shares, and has pleaded not guilty.
The would-be class action seeks to cover anyone who traded in Elan American depositary receipts or options from July 21 to 29, 2008.
Prosecutors have called the case against Martoma the "most lucrative" insider-trading scheme in history; they are reportedly seeking Martoma's cooperation in building a case against SAC founder Steven Cohen