b'and 20(a) and Rule 10b-5 of the 1934 Act. On AugustOn October 30, 2018, the Irish Tax Authority sent a 6, 2019, the court dismissed plaintiffs complaint withletter to Perrigo detailing the findings of its audit (the leave to replead (Aceto I). Plaintiff filed a secondFindings Letter), advising Perrigo that it believed the amended complaint, in which it dropped Aceto as a de- Tysabri sale should have been taxed at 33% instead of fendant and added four officers and directors of Acetothe 12.5% rate at which Perrigo paid taxes, which would as defendants for the same claims dismissed in Acetoresult in an additional tax liability of 1.6 billion (at the I. Specifically, plaintiff alleged that defendants publictime, $1.9 billion). The Findings Letter invite[d] Perrigo disclosures regarding supply issues arising from theto provide its views within three weeks, and to outline Citron and Lucid acquisitions omitted material informa- any areas of disagreement. In its November 8, 2018 tion about the depth of Acetos ongoing issue with itsForm 10-Q, Perrigo disclosed that it had received the supplier, Aurobindo, which prevented investors from un- Findings Letter, but did not disclose any details regard-derstanding the scope and magnitude of the problem. ing the Letter or its content. Rather, the 10-Q stated On August 3, 2020, the court granted defendantsonly that the Irish Tax Authority made findings about motion to dismiss the second amended complaint withtaxes in connection with the Tysabri sale, that Perrigo prejudice. The court held that even if the statements atdisagreed with the findings and would contest them, issue were misleading, defendants could reasonablyand that depending on the resolution of the issue, have determined that the allegedly omitted additionalthe amount of any future assessment could be ma-information would not have been material. The courtterial. On November 29, 2018, the Irish Tax Authority concluded that because plaintiff had not alleged anysent Perrigo a formal amended tax assessment in the additional information that defendants were under aamount of 1.6 billion. On December 21, 2019, Perrigo clear duty to disclose, the complaint failed to adequate- disclosed the amended tax assessment in a Form 8-K. ly plead scienter. The court also reaffirmed its previousThe next trading day, Perrigos stock price dropped decision in Aceto I with respect to allegations that plain- almost 25%, representing a loss of over $2 billion in tiff had recycled in the amended complaint, holding thatmarket capitalization.the amended complaint still failed to adequately allegeOn January 3, 2019, an investor filed a putative class that the statements at issue were misleading.action complaint against Perrigo and certain of its offi-On September 1, 2020, plaintiff filed a motion to altercers for violations of Sections 10(b) and 20(a) and Rule or amend the judgment. The motion is fully briefed and10b-5 of the 1934 Act. Plaintiffs claims centered around the parties are awaiting the courts order on the motion.defendants failure to disclose any loss contingency On November 12, 2020, the court requested that thearising from the Irish Tax Authoritys audit before the parties file letters concerning whether the guilty plea ofcompany received the Findings Letter, as well as their defendant Douglas Roth, Acetos former Chief Financialfailure to disclose the material details of the Findings Officer, for insider trading affected plaintiffs ability toLetter in Perrigos November 2018 10-Q. state a claim. The parties filed such letters in DecemberOn January 23, 2020, the court granted defendants 2020 and January 2021. motion to dismiss in part and denied it in part. The court first dismissed plaintiffs claims based on Perrigos failure to disclose, prior to its receipt of the October In re Perrigo Company PLC Securities2018 Findings Letter, the loss contingency Perrigo Litigation, Case No. 19-cv-70 (DLC), 435 F.potentially faced as a result of the Irish Tax Authoritys Supp. 3d 571 (S.D.N.Y. 2020)audit. As to these earlier public filings, the court held Disclosures Concerning Potential Liability for Back TaxesWith respect to scienter, the court held Perrigo Company PLC (Perrigo) is an American-Irish manufacturer of private label over-the-counter phar- that by November 2018, Perrigos duty to maceuticals. In 2013, a predecessor of Perrigo sold thedisclose under GAAP requirements was rights to a drug called Tysabri, used for the treatment of Crohns disease and multiple sclerosis, for an up-frontobvious and, as a result, the complaint payment of over $3.2 billion plus contingent royaltyraised a strong inference that Perrigos payments. In November 2017, Irelands Office of the Revenue Commissioners (the Irish Tax Authority) sentfailure to [disclose the loss contingency] a letter to Perrigo advising the company of an audit intowas highly unreasonable, representing an Perrigos tax treatment of the Tysabri sale. Perrigo dis-closed in its subsequent quarterly and annual reportsextreme departure from the standards of that the Irish Tax Authority was conducting an audit, butordinary care.did not disclose its focus or estimate potential liability. 34'