SAN DIEGO, Calif., July 29, 2003 (PRIMEZONE) -- The law firm of Robbins Umeda & Fink, LLP announces that a class action lawsuit was filed on July 29, 2003, on behalf of purchasers of the securities of Laboratory Corporation of America Holdings ("LabCorp" or the "Company") (NYSE:LH) between February 13, 2002 and October 3, 2002, inclusive (the "Class Period"), who have been damaged thereby. A copy of the complaint filed in this action is available from the Court, or can be viewed on Robbins Umeda's website at: http://www.ruflaw.com
The action, numbered 03 CV 00713 is pending in the United States District Court, Middle District of North Carolina, against defendants LabCorp, Thomas Macmahon (LabCorp's CEO), Richard L. Novak (LabCorp's COO) and Wesley Elingburg (LabCorp's CFO). If you are a member of this class, you can join this class action online at: http://www.ruflaw.com/join.html
The complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of materially false and misleading statements to the market between February 13, 2002 and October 3, 2002. During the Class Period, the Company issued statements that failed to disclose and/or misrepresented the following adverse facts, among others: (a) LabCorp was experiencing increased competition in its traditionally strongest and core markets, such as the Carolinas; (b) the Company had understaffed certain of its core markets, leading to a lack of key employees, such as phlebotomists and account representatives, causing a material deterioration of service levels and a loss of business to increased competition; (c) the decreased sale volume was caused by material operational deficiencies, rather than by a couple of pending deals that closed late, as the Company had represented; (d) defendants knew that the Company's sales problems would continue in the foreseeable future, contrary to the statements that volume growth would increase; and (e) as a result of the foregoing, the Company's assurance that its historical strong growth would continue lacked any reasonable basis. Throughout the Class Period, LabCorp insiders, including the individual defendants, sold a total of 316,112 shares of LabCorp stock at artificially inflated prices, collecting proceeds of over $26 million.
On October 3, 2002, after the close of regular trading, LabCorp shocked the market by announcing that it expected disappointing 3Q:2002 results due to "continued slowdown in volume growth in the routine, or core, testing business in certain key regions of the country," which it expected would continue at least until the end of 2002. Investors, primed by defendants' Class Period statements to believe that the Company's business was growing faster than ever and had already overcome the brief slowdown in growth during the second quarter, were shocked to learn that the slowdown had continued and was not expected to abate until after the end of the year and that the slowdown had been in the Company's core business. In reaction to the Company's belated disclosure, the price of LabCorp common stock plummeted, falling 34.6% in one day, from a close of $33.18 per share on October 3 to $21.68 per share on October 4, on trading volume of over 21.2 million shares, which is many times the Company's average daily trading volume.
If you bought the securities of LabCorp between February 13, 2002 and October 3, 2002, you may, no later than August 25, 2003 request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Robbins Umeda & Fink, LLP, or other counsel of your choice, to serve as your counsel in this action.
If you wish to discuss this action with us, or have any questions concerning this notice or your rights and interests with regard to the case, please contact the following attorney:
Robbins Umeda & Fink, LLP Marc M. Umeda 1010 Second Ave., Suite 2360 San Diego, CA 92101 Toll Free No. 800-350-6003 Email: umeda@ruflaw.com
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca