Williams & Connolly secured a major victory for CVS Health before the U.S. Court of Appeals for the First Circuit.  At issue was the decision by the District Court of the District of Rhode Island dismissing with prejudice a putative investor class action over allegedly false statements made by the pharmacy chain after its acquisition of Omnicare in 2015, as well as a goodwill write-down in early 2019. The District Court had also denied the plaintiff’s motion to reconsider the dismissal and allow plaintiffs to file a second amended complaint.

On appeal, the three-judge panel ruled that the plaintiff had not sufficiently alleged that CVS Health had made false statements or omitted material information regarding CVS’s long-term care business. “On careful de novo review,” the First Circuit concluded that, despite the length of the plaintiff’s complaint, “it fails to allege sufficiently specific facts about the state of the LTC business at particular points in time to enable us to conclude that any of the goodwill write-downs were too late or that any of defendants' alleged misstatements contradicted the state of that business as it then stood.”  On the contrary, the court emphasized that CVS disclosed challenges to the relevant business throughout the putative class period, and plaintiff had plucked many of the company’s and its executives’ statements out of context in asserting they were supposedly false or misleading.

The Williams & Connolly team representing the Company included Steven M. Farina, George A. Borden, Amanda M. MacDonald, Melissa B. Collins, Michael J. Mestitz and Elizabeth A. Wilson.

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