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Weil Defeats Securities Class Action on Behalf of Walgreens Regarding Proposed Rite Aid Merger

On October 24, 2018, Weil obtained the complete dismissal of a securities fraud class action brought against Walgreens Boots Alliance and its senior executives. The action, filed in the U.S. District Court for the Middle District of Pennsylvania, alleged that Walgreens misled investors about the likelihood the Federal Trade Commission would approve an announced merger between the company and Rite Aid.

After the court’s July 2018 decision on defendants’ motion to dismiss narrowed the alleged class period, Walgreens moved for judgment on the pleadings, arguing that the court’s order had deprived the only named plaintiff of standing. Plaintiff, whom the court had appointed as lead plaintiff under the Private Securities Litigation Reform Act, responded by moving to intervene additional plaintiffs who alleged standing under the shortened class period. Walgreens opposed the motion on the basis that, where the only plaintiff lacks standing, the court lacks jurisdiction and no joinable case exists.

The court agreed, holding that plaintiff lacked standing, that the intervenors had not established a right to intervene, that, “more generally, a motion for intervention is not appropriate to cure a lack of standing,” and that the absence of a “case” or “controversy” also “counsel[ed] against granting permissive intervention.” Accordingly, the court granted Walgreens’ motion for judgment on the pleadings and denied the motion to intervene.

The Weil team was led by Litigation Department Co-Chair Jonathan Polkes and Securities Litigation partner Caroline Hickey Zalka, and included associates Larkin Kuplic, Jonnah Hollander, Andrew Cauchi, Patrick Branson (not yet admitted in New York), and Jenna Harris (not yet admitted in New York).