Frequently Asked Questions
- What is this case about?
- Why did I receive a Notice?
- Who is eligible to participate in the Valeant Pharmaceuticals Fair Fund?
- Who is excluded from participating in the Valeant Pharmaceuticals Fair Fund?
- What are the eligible Securities?
- What is the Relevant Period?
- What do I need to do to participate in the Valeant Pharmaceuticals Fair Fund?
- When is the deadline to file a claim?
- Who is the Fund Administrator for the Valeant Pharmaceuticals Fair Fund?
- How do I get more information or contact the Fund Administrator?
- What is this case about?
On July 31, 2020, the Commission issued the Orders instituting and simultaneously settling proceedings against the Respondents. In the Orders, the Commission found that beginning in 2014, when announcing certain GAAP and non-GAAP financial measures, Valeant, among other things, misstated revenue transactions and included erroneous revenue allocations. For example, the Orders found that for five consecutive quarters Respondents touted double-digit same store organic growth, a non-GAAP financial measure that represented growth rates for businesses owned for one year or more. Much of that growth came from sales to Philidor, a mail order pharmacy Valeant helped establish, fund, and subsidize. The Orders found that Valeant improperly recognized revenue relating to Philidor sales and did not disclose its unique relationship with, or risks related to Philidor in its SEC filings and earnings and investor presentations. Valeant ended its ties to Philidor in October 2015 and restated its 2014 financial statements in April 2016, reducing the revenue that was improperly recognized.
The Orders also found that Valeant failed to disclose the material impact of certain revenue it received from drug wholesalers following a 500% increase of the price of a single drug that Valeant acquired in April 2015. Valeant erroneously attributed the resulting revenue to more than 100 unrelated products and did not record any as attributable to that drug. Additionally, in its SEC filings and earnings presentations for the second and third quarters of 2015 and its 2015 year-end report, Valeant failed to disclose the impact of that allocation on its GAAP and non-GAAP financial measures.
In their respective orders, the Commission found that Respondents violated the antifraud provisions of Sections 17(a)(2) and 17(a)(3) of the Securities Act and, with the exception of Schiller, Rule 100(b) of Regulation G. The Commission also found that Valeant violated the reporting, books and records, and internal accounting controls provisions of the Exchange Act, and that the individual respondents caused some or all of these violations. Valeant, Pearson, Schiller, and Carro were ordered, among other things, to pay civil penalties in the amount of $45 million; $250,000; $100,000; and $75,000, respectively, for a total of $45,425,000 to the Commission. In each of the Orders, the Commission also created a Fair Fund, pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002, so the penalties collected can be distributed to harmed investors.
On January 8, 2024, the Commission ordered that the Fair Funds created in each of the Orders be consolidated for the purposes of distribution administration.
Top
On February 12, 2024, the Commission appointed KCC Class Actions Services, LLC, (“KCC”) the Fund Administrator for the Fair Fund, in accordance with the Plan of Distribution approved by the SEC. On August 22, 2024, the Commission approved a Corrected Distribution Plan for the Valeant Pharmaceuticals Fair Fund (the "Plan"). - Why did I receive a Notice?
You received a Notice because you may have purchased Valeant common stock between October 20, 2014 and April 28, 2016, inclusive, and/or Valeant bonds listed in Table C of the Plan of Allocation between October 20, 2014 and October 29, 2015, inclusive, and suffered harm as a result of the Respondents’ misconduct. Investors who fit these criteria may be eligible for a distribution from the Fair Fund that was established in the Securities and Exchange Commission enforcement actions against the Respondents.
Top - Who is eligible to participate in the Valeant Pharmaceuticals Fair Fund?
Investors who are determined by the Fund Administrator to have purchased the Securities during the Relevant Purchase Period and suffered harm as a result of the Respondents’ misconduct, and who are not Excluded Parties, as the term is defined in the approved Plan of Distribution.
Top
You can view the approved Corrected Plan of Distribution on the "Case Documents" tab of this website. - Who is excluded from participating in the Valeant Pharmaceuticals Fair Fund?
Excluded from the Fair Fund are:
Top
(a) the Respondents;
(b) Present or former officers or directors of Respondents or any assigns, creditors, heirs, distributees, spouses, parents, dependent children or controlled entities of any of the foregoing Persons or entities;
(c) Any employee or former employee of the Respondents or any of its affiliates who has been terminated for cause or has otherwise resigned, in connection with the conduct described in the Order;
(d) Any Person who, as of the Claims Bar Date, has been the subject of criminal charges related to the conduct described in the Order or any related Commission action;
(e) Any firm, trust, corporation, officer, or other entity in which Respondents has or had a controlling interest;
(f) The Fund Administrator, its employees, and those Persons assisting the Fund Administrator in its role as the Fund Administrator; or
(g) Any purchaser or assignee of another Person’s right to obtain a recovery from the Fair Fund for value; provided, however, that this provision will not be construed to exclude those Persons who obtained such a right by gift, inheritance or devise. - What are the eligible Securities?
- Valeant Pharmaceuticals International, Inc. Common Stock
- The Valeant Pharmaceuticals International, Inc. Bonds listed below:
TopCUSIP
144A Offering / Reg S Offering
91831AAA9 / EK8064983
91831AAB7 / EK8064801
91831AAC5 / EK8065162
EK8066186 / EK7990790
92912EAA1 / EJ7382413
92912EAC7 / EJ7382611
91829KAA1 / EJ3752296
91911KAD4 / EJ9423611
91911KAE2 / EK7043582
91911XAM6 / EI4142986
91911XAQ7 / EI5650532
91911XAS3 / EI5995440
- What is the Relevant Period?
The Relevant Period is between October 20, 2014 and April 28, 2016, inclusive for stock or between October 20, 2014 and October 29, 2015, inclusive for bonds listed in table C of the Plan of Allocation. The Eligible Securities are also listed in the previous FAQ question 5.
Top - What do I need to do to participate in the Valeant Pharmaceuticals Fair Fund?
In order to be considered for eligibility to receive a Distribution Payment under the Corrected Plan of Distribution, you must return a completed Claim Form (paper or via the online portal on this website) and submit acceptable supporting documentation to support your claim, by the Claims Bar Date of January 16, 2025.
Top
Participation in the Valeant Pharmaceuticals Fair Fund does not require you to release any rights or potential claims you may have against the Respondent (other than with respect to the Fund Administrator), including but not limited to the Respondents’ past and present directors, officers, promoters, advisers, agents, affiliates, nominees, assigns, creditors, or controlled entities. - When is the deadline to file a claim?
All Claims must be filed by the Claims Bar Date of January 16, 2025
Top - Who is the Fund Administrator for the Valeant Pharmaceuticals Fair Fund?
The Commission appointed KCC Class Action Services, LLC, (“KCC”) as the Fund Administrator for the Valeant Pharmaceuticals Fair Fund on February 12, 2024.
Top - How do I get more information or contact the Fund Administrator?
Additional information regarding the Valeant Pharmaceuticals Fair Fund may be found on this website. You may also contact the Fund Administrator by calling the toll-free number 1-888-890-6712 or by email to [email protected].
Top
If you would like to get copies of the relevant documents, including the Corrected Distribution Plan, please visit the Case Documents page on this website.