A federal judge has thrown out a lawsuit in which the former president of North American Vaccine Inc. of Columbia had accused company directors of illicit profiteering at the expense of stockholders and of other wrongs, the company announced yesterday.
U.S. District Judge Alexander Williams Jr., in an order signed Friday, rejected every allegation raised in the suit by former president Sharon Mates.
Mates charged that certain directors had approved a special deal that gave them stock rights at below-market prices in exchange for $25 million in financing for the company. Williams ruled that Mates did not have legal standing to challenge the deal, but he did not rule on the merits of the deal itself.
Williams rejected several other claims as well. For instance, he said the board of North American Vaccine was within its rights when it fired Mates on Sept. 23. And he rejected a claim that the company had defamed her in a news release announcing her dismissal.
"The decision issued by the U.S. District Court . . . confirms the company's earlier statement that we believed the lawsuit to be without merit," North American Vaccine's general counsel, Daniel Abdun-Nabi, said in a statement.
Attorneys for Mates said they would seek to have the case reinstated. "Clearly, we and our client are disappointed with the court's ruling," said Daniel E. Loeb, one of Mates's attorneys. "We disagree with Judge Williams's ruling. There are errors in his ruling. And we intend to appeal." He declined to discuss the specific errors he believed the judge had made.
Mates claimed in her lawsuit that certain directors of North American Vaccine, including drug-industry executives Phillip Frost and Francesco Bellini, cooked up what she described as a "sweetheart deal." She claimed she was fired when she found out about the deal and tried to stop it.
The company said there was nothing wrong with the deal and that Mates was fired to make room for a new chief executive of "proven skill and experience in the industry." Randal Chase, a former executive of vaccine leader Pasteur Merieux Connaught, was subsequently appointed to lead North American Vaccine.