Judge Expedites Pershing Square Lawsuit Against Allergan

Aug 28 2014 | 11:02am ET

Allergan Inc. may have to wait in line to proceed with its insider-trading lawsuit against Pershing Square Capital Management, but the hedge fund’s claims against the Botox-maker are getting the fast-track treatment denied Allergan.

Delaware’s chancellor, Andre Bouchard, granted Pershing Square and Valeant Pharmaceuticals International’s request for an expedited hearing of their case against Allergan. The two, which are working together on Valeant’s $53 billion hostile takeover bid for Allergan, want the courts to certify their request for a special meeting—at which they hope to take control of Allergan’s board—and to bar Allergan from making any acquisitions before that meeting.

Allergan this week announced that the meeting would be held on Dec. 18—pending a review of the 1,500 pages in consent forms from investors representing 31% of its shares submitted on Friday by Pershing Square and Valeant. But that meeting could be moved up following a three-day trial set to begin on Oct. 6.

Bouchard noted that “Allergan may not want a special meeting at all.”

Allergan has sued Pershing Square and Valeant in California federal court, accusing the two of insider trading and asking that Pershing Square’s 9.7% stake in the company be cancelled. But a judge in Santa Ana rejected Allergan’s bid for an expedited hearing, directing the parties to duke it out in Delaware.

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