8-KOther Events

MCKESSON CORP 8-K Report, Corporate Update (Dec 13, 2005)

Filed December 13, 2005For Securities:MCK

Summary

This 8-K filing by McKesson Corporation (MCK) on December 12, 2005, reports a new legal development concerning a previously announced settlement of a consolidated securities class action lawsuit related to the 1999 acquisition of HBO & Company, Inc. Bear Stearns & Co. Inc. has filed a complaint alleging that McKesson breached an engagement letter by entering into the settlement without providing a full release for Bear Stearns. Bear Stearns is seeking monetary damages and an injunction to prevent McKesson from proceeding with the settlement. The company maintains that Bear Stearns' claims are without merit and has stated it will vigorously oppose the lawsuit. This legal action by Bear Stearns was previously raised as an objection to the preliminary approval of the class action settlement but was rejected by the presiding judge. A hearing for final approval of the settlement is scheduled for January 27, 2006. Investors should monitor the outcome of this lawsuit and its potential impact on the class action settlement.

Key Highlights

  • 1McKesson Corporation is facing a new lawsuit filed by Bear Stearns & Co. Inc.
  • 2The lawsuit stems from McKesson's previously announced settlement of a consolidated securities class action.
  • 3Bear Stearns alleges McKesson breached an engagement letter by not providing a full release in the settlement.
  • 4Bear Stearns is seeking monetary relief and an injunction to block the settlement.
  • 5McKesson believes the lawsuit is without merit and will vigorously defend itself.
  • 6The objection raised by Bear Stearns was previously rejected by the judge overseeing the class action settlement.
  • 7A final approval hearing for the class action settlement is scheduled for January 27, 2006.

Frequently Asked Questions

The main issue is that Bear Stearns & Co. Inc. has filed a lawsuit against McKesson Corporation, alleging a breach of contract related to the settlement of a prior securities class action lawsuit concerning the 1999 acquisition of HBO & Company, Inc.

Bear Stearns is seeking monetary damages and an injunction to prevent McKesson Corporation from executing the settlement agreement of the class action lawsuit.

McKesson Corporation believes the lawsuit filed by Bear Stearns is without merit and intends to vigorously oppose it and the injunctive relief sought.

Yes, Bear Stearns had previously raised the same objection in opposition to the preliminary approval of the class action settlement, but the judge rejected it as a reason to deny approval.