Tag Archives: Matrixx Initiatives

U.S Supreme Court Weighs In on Materiality of Reports of Adverse Effects of Over the Counter Drug That Were Not Statistically Significant

On March 22, 2011 the U.S. Supreme Court handed down a decision which is likely to have serious repercussions for companies in the bio/pharma tech space.  In MATRIXX INITIATIVES, INC., ET AL. v. SIRACUSANO ET AL., the Court rejected Matrixx argument that reports regarding the adverse effect of Zicam, its leading revenue generating product, were not statistically significant and therefore not material.

Noting that the analysis of materiality under the securities laws in fact specific, the Court appears to have relied heavily on two factors:

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