More than a dozen law firms nationwide are now seeking out investors in Portland-based Covetrus Inc. to join up as plaintiffs in lawsuits alleging the company engaged in investment fraud.

Since an investor lawsuit against Covetrus was filed Monday by the city of Hollywood Police Officers’ Retirement System in Florida, which invested in the company and lost money because of a precipitous stock price decline in August, at least 15 law firms have issued their own public notices soliciting other potential plaintiffs.

The company is an animal health technology and services firm that went public eight months ago and then had a disastrous second quarter. Stock was trading at more than $46 per share at the initial public offering; on Friday it  closed at $11 per share.

Saxena White P.A., a Boca Raton, Florida, law firm that specializes in securities class-action lawsuits, is representing the retirement system and also seeking other Covetrus investors as clients and requesting class-action status. The law firm filed a complaint in U.S. District Court for the Eastern District of New York that alleges executives at Covetrus and its predecessors, Vets First Choice and Henry Schein Animal Health, knowingly misled investors about the financial health and capabilities of Covetrus to artificially inflate its stock value.

In particular, the law firms are looking for investors that could potentially be appointed lead plaintiff, or class representative, in a class-action lawsuit. If class-action status is granted, a judicial panel would have to decide who the class representative would be and which jurisdiction would be best to litigate the case. The judges often make such decisions based on factors such as which plaintiff has the most at stake in the case, and which law firm representing a potential class representative has the most experience litigating similar cases.

One notice, issued by law firm Kahn Swick & Foti LLC of New Orleans, suggests that only investors or investment funds that have lost $100,000 or more from the Covetrus stock price decline would likely be eligible for class representative status. In a class-action lawsuit, the class representative’s attorneys do the majority of work and stand to gain the most financially from a favorable ruling.


Attorney Peter Murray of Portland-based Murray, Plumb and Murray said it’s not unusual for multiple class-action complaints to be filed in different jurisdictions containing the same allegations against the same defendants before they are consolidated into a single class-action lawsuit.

If the class representative prevails, all members of the class would be eligible for monetary relief, usually through a settlement, Murray said.

“This is called a fraud-on-the-market class action, because the (alleged) misrepresentations were not made to any particular person,” he said. “All the existing shareholders potentially are victims of fraud, provided that they can show they relied on that information, or lack of information, in either buying securities or not selling their stock when they had a chance to do so at a better price.”

Covetrus declined to comment on the flurry of solicitations for class-action plaintiffs, citing the pending litigation.

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