United States District Court, S.D. Ohio, Western Division
Robert W. Huellemeier, derivatively on behalf of Teva Pharmaceutical Industries Limited Employee Stock Purchase Plan, Plaintiff,
Teva Pharmaceutical Industries Limited, et al., Defendants.
ORDER GRANTING MOTION TO TRANSFER THIS ACTION TO THE
DISTRICT OF CONNECTICUT
J. Dlott United States District Judge.
matter is before the Court on Defendants' Motion to
Transfer (Doc. 13). Plaintiff Robert Huellemeier,
derivatively on behalf of the Teva Pharmaceutical Industries
Limited Employee Stock Purchase Plan (“the
ESPP”), has filed this suit pursuant to § 11 of
the Securities Act, 15 U.S.C. § 77k, against Defendants
Teva Pharmaceutical Industries Limited (“Teva”)
and three corporate officers, Erez Vigodman, Eyal Desheh, and
Shlomo Yanai (collectively, the “Teva Officers”).
Defendants now move the Court to transfer this action on the
basis of the first-to-file rule, or alternatively, 28 U.S.C.
§ 1404, to the District of Connecticut where two class
action suits are pending against Teva, Vigodman, and Desheh.
For the reasons that follow, the Court will
GRANT the Motion to Transfer.
The Southern District of Ohio Action
states the following allegations of fact against Teva and the
Teva Officers in the Complaint (Doc. 1): Teva is a global
pharmaceutical company with operations in the United States,
Europe, and other markets, and with facilities in Ohio.
Vigodman was a Director for Teva at all relevant times.
Desheh was the Chief Financial Officer for Teva at all
relevant times. Yanai was the President and Chief
Executive Officer for Teva at all relevant times.
(Id. at PageID 3.) Teva registered 70, 000, 000
American depository shares with the SEC in July 2010, some
for purchase by employees of the company through the ESPP.
(Id.) Huellemeier is a current or former Teva
employee who purchased Teva shares through the ESPP between
February 9, 2015 and November 3, 2016 (“the Class
Period”). (Id. at PageID 2-3.)
Vigodman and Desheh signed financial disclosure forms on
behalf of Teva during the Class Period, including the 2014
20-F and 2015 20-F forms. (Id. at PageID 5-11.)
Huellemeier alleges that Teva made a number of material
misstatements and omissions in the financial disclosure
forms. He alleges that Teva failed to disclose that it was
under an antitrust investigation for price-fixing by the
Department of Justice (“DOJ”) and the Attorney
General's Office for the State of Connecticut, that it
was under investigation by the DOJ for violation of the
Foreign Corrupt Practices Act, including bribery of Russian
government officials, and that it lacked effective internal
controls over its financial reporting. (Id. at 11.)
on behalf of the ESPP, filed the Complaint against Teva and
the Teva Officers on July 17, 2017. Huellemeir asserts the
following claims for relief in the Complaint based on alleged
misrepresentations and omissions in the registration
1. Violation of § 11 of the Securities Act, 15 U.S.C.
§ 77k, against all Defendants;
2. Breach of fiduciary duties against unspecified Defendants;
3. Misrepresentation and non-disclosure against unspecified
4. Breach of contract against unspecified Defendants.
(Id. at PageID 34-38.) Huellemeier purports to bring
the action as a derivative action “on behalf of all
persons who purchased or otherwise acquired Teva American
Depository Shares [ ] between February 9, 2015 and November
3, 2016 . . . in the ESPP.” (Id. at PageID
1-2.) He also asserts, in the alternative, a
class action on behalf of individuals who purchased or
otherwise acquired the Teva shares pursuant to the ESPP
during the Class Period. (Id. at PageID 32-34.)
now move the Court to transfer this action to the District of
Connecticut on the basis of the first-to-file rule or,
alternatively, 28 U.S.C. § 1404. Huellemeier opposes the
transfer of this action. The matter is fully briefed and ripe
The District of Connecticut Actions
move to transfer this case on the grounds that it is
duplicative of earlier-filed suits now pending in the
District of Connecticut. Accordingly, it is necessary to
provide a brief overview of the other pending cases. Two
cases initially were filed in the Central District of
California in 2016 before being transferred to the District
of Connecticut as explained below. Galmi v. Teva
Pharmaceutical Industries Limited, No. 2:16-cv-08259
(C.D. Cal.) was filed filed on November 6, 2016 and Leone
v. Teva Pharmaceutical Industries Limited, No.
2:16-cv-09545 (C.D. Cal.) was filed on December 27, 2016.
Amram Galmi filed suit against Teva, Vigodman, and Desheh, on
behalf of a class of similarly-situated persons who purchased
or acquired Teva shares between February 10, 2015 and
November 3, 2016. Galmi asserted claims for alleged
violations of §§ 10(b) and 20(a) of the Securities
Exchange Act of 1934 (“Exchange Act”), 15 U.S.C.
§§ 78j(b) and 78t(a),  and Rule 10b-5 promulgated by ...