SOURCE: Brower Piven, A Professional Corporation

April 12, 2011 12:41 ET

Brower Piven Files Class Action Suit Against Celera Corporation (NasdaqGS: CRA)

STEVENSON, MD--(Marketwire - Apr 12, 2011) - The law firm of Brower Piven, A Professional Corporation, today announced that a class action has been commenced in the United States District Court for the Northern District of California, Case No. 11-cv-1769, on behalf of all persons who held shares of the common stock of Celera Inc. ("Celera") (NASDAQ: CRA) on April 11, 2011, against Celera and members of its Board of Directors for violations of Sections 14 and 20 of the Securities Exchange Act of 1934 ("1934 Act") and for breaching their fiduciary duties to Celera shareholders in connection with a tender offer by Spark Acquisition Corp., which is owned and controlled by Quest Diagnostics Inc. ("Quest"), to purchase Celera for $8.00 per share in cash ("Tender Offer").

Celera is a healthcare business focusing on the integration of genetic testing into routine clinical care through a combination of products and services incorporating proprietary discoveries. The complaint states that on March 18, 2011 Celera announced that it had accepted a buyout offer of $344 million ($8.00 per share) from Quest, whereby Quest would, within a week of the deal's announcement, commence a tender offer to acquire all of the issued and outstanding shares of Celera common stock. This price, according to the complaint, is an inadequate 28% premium to the Company's closing stock price on the day immediately preceding the announcement of the Tender Offer, which premium was quickly vanquished by the market upon news of the Tender Offer. At the same time, the complaint states that the Company shocked the market by filing a host of restatements to its prior Securities and Exchange Commission ("SEC") financial filings ("Restatements"). The complaint alleges that these Restatements expose the fact that Celera's management has engaged in a wide-ranging accounting fraud over the past several years, which included improperly classifying and reporting bad debt expenses and unreimbursed and uncollectible charges. The complaint alleges that these fraudulent accounting practices materially affected Celera's financial statements. The complaint also alleges that the Restatements are so expansive and damning that had they been disclosed independent of a merger announcement that propped up the stock price, they would have exposed the Company's senior management, as well as the entire Board, to possible liability for violating the federal securities laws. Further, the complaint alleges that as the need for the Restatements became apparent, Kathy Ordonez, Celera's Chief Executive Officer, with the assistance of the rest of the Board, moved quickly to sell the Company at any price in exchange for broad indemnity and continuing employment for Celera's senior management team.

To effectuate a sale in advance of the Restatements, the complaint states that, Ordonez and the Board were forced to accept an offer from the Company's long-time strategic partner, Quest, that was well below what Quest had previously indicated it was prepared to pay for Celera. According to the complaint, Quest had previously offered over $10 a share for Celera, but revised its offer significantly downward in light of defendants' demand for broad indemnification and senior management's request for continued employment post-closing. The complaint alleges that this self-interested negotiating cost Celera shareholders maximum value for their shares, as the Celera Board was eventually forced to accept the $8.00 price if they were to (a) strike a deal in advance of the Restatements; and (b) secure the indemnification and future employment for senior management that they sought.

The complaint alleges that Celera failed to disclose material information in Tender Offer materials filed with the SEC and publicly disseminated in connection with the Tender Offer by Celera on March 28, 2011. According to the complaint, the Tender Offer materials were materially false and misleading because they fail to provide shareholders with adequate disclosure about the sales process, or the financial calculations used to justify the merger price. Specifically, the Tender Offer materials omit and/or misrepresent material information in contravention of Sections 14 and 20 of the 1934 Act and/or defendants' fiduciary duty of disclosure under state law.

If you are a Celera shareholder and you wish to serve as lead plaintiff, you must move the Court by June 13, 2011. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, Charles Piven of Brower Piven at 410/415-6616 or by email at hoffman@browerpiven.com. If you are a member of this class, you can view a copy of the complaint at www.browerpiven.com. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.

Plaintiff seeks to recover damages on behalf of all holders of Celera common stock on April 11, 2011 (the "Class"). The plaintiff is represented by Brower Piven, whose attorneys have combined experience litigating securities and class action cases of over 60 years. The Brower Piven website (www.browerpiven.com) has more information about the firm.

Contact Information

  • CONTACT:
    Brower Piven, A Professional Corporation
    Stevenson, Maryland
    Charles J. Piven
    410/415-6616
    Email Contact