NEW YORK--(EON: Enhanced Online News)--The law firm of Wohl & Fruchter LLP is investigating possible violations of federal securities laws by officers and directors of Teva Pharmaceutical Industries Limited (Teva) (NYSE: TEVA).
“the lack of unity among the board of directors and CEO hurts our ability to make the necessary changes”
Teva is a global manufacturer of brand name and generic pharmaceuticals founded and based in Israel.
On January 1, 2012, the chairman of Teva’s board of directors (Board), Phillip Frost (Frost), announced that Shlomo Yanai was retiring as the Company’s CEO and President, and that the Board had named Dr. Jeremy Levin (Levin), a former senior executive at Bristol-Myers Squibb, to replace Yanai in those positions.
In December 2012, Levin and his management team announced a five-year cost cutting program projected to help Teva achieve annual cost savings of $1.5 billion to $2 billion by 2018.
On October 10, 2013, Teva announced an acceleration of its cost cutting program under which it would lay off 5,000 workers worldwide in 2014, including about 800 employees in Israel.
On October 16, 2013, the press reported that the planned layoffs in Israel had generated a public uproar. One member of Israel’s parliament was quoted as stating that Teva’s planned layoffs were “an act of cannibalism” in light of the tax breaks and subsidies that Teva has long enjoyed in Israel.
On October 28, 2013, Channel 2 television in Israel quoted unnamed sources as indicating that Levin was considering resigning due to strong differences of opinion between himself and Frost concerning execution of Teva’s strategy, including how to handle the planned layoffs in Israel. Among other things, Channel 2 cited a letter from certain senior executives to the Board stating that “the lack of unity among the board of directors and CEO hurts our ability to make the necessary changes,” and urging the Board to “reconsider its intervention in the daily course of business that we believe has become common in recent months and prevents management from being able to manage Teva effectively.”
Later that day, Levin denied that he was considering resigning because of disagreements with Frost and the Board, and Teva issued a separate statement saying that reports of differences of opinion between Levin and Frost over execution were “baseless.”
On October 30, 2013, Teva announced that Levin would, in fact, be resigning as CEO and President. In connection with Levin’s departure, Frost was quoted as stating that there were differences between the Board and Levin concerning execution of Teva’s strategy.
Upon the news of Levin’s departure, TEVA shares declined 8% from a close of $41.02/share on October 29, 2013, to a close of $37.70/share on October 30, 2013.
Persons with relevant information, and TEVA shareholders with questions about this investigation, are invited to contact the attorney below, or our Firm by calling 866.833.6245.
Additional information is available on our website at: http://www.wohlfruchter.com/cases/teva.
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Wohl & Fruchter LLP represents plaintiffs in litigation arising from fraud and other fiduciary breaches by corporate managers, as well as other complex litigation matters. Please visit our website, www.wohlfruchter.com, to learn more about our Firm, or contact one of our partners.
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