Accentuating the caveat emptor perspective with critical commentary on financial disclosure. I adopt a skeptical persona and look for chinks in the teflon coating of financial disclosure. My job is to identify financial warts. Perhaps a Black Swan. Disclosure: I do not hold positions in stocks mentioned for three trading days before or after blog post.
Thursday, May 18, 2006
Merck Dodges a Bullet
Merck (NYSE:MRK) has been beaten up lately in New Jersey over Vioxx. However a derivative shareholder suit has been dismissed. U.S. District Judge Stanley Chesler dismissed the suit. The plaintiffs failed to comply with a federal court rule requiring shareholders to demand, prior to filing suit, that the board of directors take corrective action. An important governance issue that the lawyers overlooked. You cannot just start lawsuits.