New Jersey Court Dismisses Biovail Suit Against Hedge Fund Manager S.A.C. Capital Advisors

The New Jersey Superior Court has thrown out claims that hedge fund manager S.A.C. Capital Advisors (SAC) conspired with other firms, including the independent research firm Gradient Analytics, Inc. (formerly known as Camelback Research Alliance, Inc.) (Gradient) to drive down the stock price of Canada’s largest publicly-traded pharmaceutical company, Biovail Corporation (Biovail).  The court dismissed the suit after it determined that Biovail failed to prove it was entitled to damages and that, in any event, the court lacked jurisdiction over all but one of the defendants.  Most notably, the court stated that it did not evaluate the merits of Biovail’s claims against SAC or Gradient.  We describe the court’s reasoning as to why the research company’s reports did not give rise to a viable claim and why the court lacked jurisdiction over the parties.

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