Dr. Reddy's Laboratories on Monday said a class action lawsuit had been filed against the company and a few of its top executives for alleged violations of USA federal securities law, a disclosure that saw the drugmaker's stock shed 2.01%.
Dr Reddy's in a communique to bourses said that: "The case has been filed in the US District Court of New Jersey". The company has yet not been served with the lawsuit and can not comment on the "specific allegations in the pending litigation other than to state that the company believes the asserted claims to be without merit", it added.
It claimed that the company had "made false and/or misleading statements and/or failed to disclose that Dr. Reddy's lacked an effective corporate quality system; and as a result, defendants' public statements were materially false and misleading at all relevant times".
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"The lawsuit seeks damages to compensate the purported class of investors for a purported decline in the company's share price allegedly caused by the alleged misstatements or omissions", DRL said in the filing.
"The company will respond to the allegations after it has been served with the lawsuit and as and when it may be required to do so by the court", it added. The stock hit its intraday high and low of Rs 2,089 and Rs 2,029.70, respectively.