Case alleging United Drug scuppered $80m sale of firm dropped
A potentially damaging US legal action taken against United Drug amid allegations that comments chief executive Liam FitzGerald made adversely impacted an $80m (€61.2m) company sale has been dropped by the two sides involved.
Catalent Pharma Solutions, a firm controlled by private equity giant Blackstone, had taken the case against the Irish group last year and had sought unspecified damages. The trial was due to start next month in New York.
Mr FitzGerald told investors during a conference call in November 2011 that Blackstone had put Catalent's pharmaceutical packaging division up for sale.
He told the callers that the Catalent unit was underperforming and that United Drug had been picking up business from Catalent clients.
United Drug has a subsidiary in the US called Sharp Corporation, which was also sued in the same action by Catalent.
United Drug, whose interests stretch across drug packaging, marketing, sales and distribution, had been among the frontrunners to buy the Catalent unit, which had been expected to fetch as much as $80m.
The Irish company didn't ultimately buy it and it was sold for less than the estimated price tag.
Catalent alleged that Mr FitzGerald publicly disclosed the sale process despite United Drug having signed a non-disclosure agreement, and also impaired the sales process. United Drug had rejected the allegations.
"Moreover, and as United Drug's CEO brazenly bragged during the November 16, 2011 calls, Sharp and United Drug have also misused Catalent's highly confidential and sensitive business information, which constituted its trade secrets, to poach its customers," claimed Catalent in its original complaint.
In August last year, United Drug filed a motion in the US to have the case against it dismissed. In January, that motion was dismissed.
But the case has just been dropped under an agreement between Catalent and United Drug, with each side liable for their own costs.
Court hearings had been slated to begin on July 29.