HOUSTON, August 8, 2003 (PRIMEZONE) -- Emerson Poynter LLP, a securities class action trial law firm, announced today that a class action lawsuit has been filed in the United States District Court for the Middle District of North Carolina, 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''). A copy of the complaint can be obtained from the Court or by making a toll-free call to the Firm.
The complaint alleges 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 purchased LabCorp securities between February 13, 2002 and October 3, 2002, inclusive, and you wish to serve as lead plaintiff, you must move the Court through Emerson Poynter or other counsel of your choice, not later than August 25, 2003. If you are a member of this class, you can join this class action by contacting Emerson Poynter via e-mail or calling toll-free.
Emerson Poynter has substantial experience representing investors in securities fraud class action lawsuits such as this. The firm has offices in Houston, Texas and Little Rock, Arkansas, but represents investors throughout the nation. If you have any questions about how you may be able to recover for your losses, or if you would like to consider serving as one of the lead plaintiffs in this lawsuit, you are encouraged to call toll free or e-mail the firm. John G. Emerson, 830 Apollo Lane, Houston, TX 77058. Phone (281) 488-8854.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.