HARTFORD, Conn., Feb. 3, 2006 (PRIMEZONE) -- The law firm of Schatz & Nobel, P.C., which has significant experience representing investors in prosecuting claims of securities fraud, announces that a lawsuit seeking class action status has been filed in the United States District Court for the Eastern District of Kentucky on behalf of all persons who acquired the publicly traded securities of Omnicare, Inc. ("Omnicare" or the "Company") (NYSE:OCR) between August 3, 2005 and January 27, 2006, inclusive, (the "Class Period").
The Complaint alleges defendants violated federal securities laws by issuing a series of materially false statements regarding Omnicare's financial condition. Specifically, defendants failed to disclose that: (i) Omnicare was artificially inflating its earnings by engaging in improper generic drug substitution; (ii) the Company was not in compliance with Medicare laws; (iii) the implementation of the Medicare Part D Plan had dramatically increased the Company's costs and increased the number of rejected Medicare claims to nearly 40%; and (iv) the Company was not "well-positioned to add value under the new Medicare Part D" Plan, but rather, Omnicare lacked adequate staff and internal compliance controls to ensure the Company could benefit from the new plan and instead, the Part D Plan wreaked havoc on the Company's business model, sending costs, rejection rates and receivables far higher than shareholders were led to believe.
On January 30, 2006, Associated Press reported that on January 27, 2006, the Michigan attorney general's office raided Omnicare's offices in Livonia and other cities. On this news, an analyst with Stifel Nicolaus downgraded the stock due to his concerns regarding the raid and the potential for further raids on the Company's offices. On January 30, 2006, Omnicare shares fell $5.09 to $49.96.
If you are a member of the class, you may, no later than April 3, 2006, request that the Court appoint you as lead plaintiff of the class. A lead plaintiff is a class member that acts on behalf of other class members in directing the litigation. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs make important decisions which could affect the overall recovery for class members, including decisions concerning settlement. The securities laws require the Court to consider the class member(s) with the largest financial interest as presumptively the most adequate lead plaintiff(s).
While Schatz & Nobel has not filed a lawsuit against the defendants, to view a copy of the Complaint initiating the class action or for more information about the case, class action cases in general, and your rights, please contact Schatz & Nobel toll-free at (800) 797-5499, or by e-mail at sn06106@aol.com, or visit our website: www.snlaw.net .