Medtronic 2015 Annual Report Download - page 134

Medtronic plc
Notes to Consolidated Financial Statements (Continued)
connection with the Synchromed pain pump system. On May 26, 2015, the Himmel,Saratoga Advantage Trust,Road Carriers
Local 707, and Cutler plaintiffs filed Voluntary Stipulations of Dismissal with Prejudice or statements of non-opposition to
dismissal of all INFUSE-related claims and allegations. On June 4, 2015, the Court preliminarily approved the INFUSE-related
dismissals with prejudice subject to shareholder notice and an opportunity to intervene. On June 9, 2015, the Company provided
notice of the Court’s order in a Form 8-K filing.
On September 26, 2014, Richard Hockstein filed an INFUSE-related shareholder derivative action against both Medtronic, Inc.
and certain of its current and former officers and members of its Board of Directors in the United States District Court for the
District of Minnesota making allegations similar to those in the Kokocinski case. West Virginia Pipe Trades and Phil Pace, on
June 27, 2013 and July 3, 2013, respectively, filed putative class action complaints against Medtronic, Inc. and certain of its
officers in the U.S. District Court for the District of Minnesota, alleging that the defendants made false and misleading public
statements regarding the INFUSE Bone Graft product during the period of December 8, 2010 through August 3, 2011.
Shareholder Related Matters Resulting from the Covidien Acquisition
On July 2, 2014, Lewis Merenstein filed a putative shareholder class action in Hennepin County, Minnesota, District Court
seeking to enjoin the then-potential acquisition of Covidien. The lawsuit named Medtronic, Inc., Covidien, and each member of
the Medtronic, Inc. board at the time as defendants, and alleged that the directors breached their fiduciary duties to shareholders
with regard to the then-potential acquisition. On August 21, 2014, Kenneth Steiner filed a putative shareholder class action in
Hennepin County, Minnesota, District Court, also seeking an injunction to prevent the potential Covidien acquisition. In
September of 2014, the Merenstein and Steiner matters were consolidated and in December of 2014, the plaintiffs filed a
preliminary injunction motion seeking to enjoin the Covidien transaction. On December 30, 2014, a hearing was held on
plaintiffs’ motion for preliminary injunction and on defendants’ motion to dismiss. On January 2, 2015, the Court denied the
plaintiffs’ motion for preliminary injunction and on January 5, 2015 issued its opinion. On March 20, 2015, the Court issued its
order and opinion granting Medtronic’s motion to dismiss the case. In May of 2015, the plaintiffs filed an appeal with the
Minnesota State Court of Appeals.
In connection with the then-potential acquisition of Covidien, on September 19, 2014, William A. Houston filed a putative
shareholder class action in the United States District Court for the District of Minnesota and on October 3, 2014, Marilyn Clark
filed a complaint in the United States District Court for the District of Minnesota that is nearly identical to the Houston
complaint. These actions named as defendants certain members of Medtronic, Inc.’s board of directors at the time and certain of
Medtronic, Inc.’s officers, and also named Medtronic, Inc. as a nominal defendant. The Houston and Clark complaints asserted
various causes of action under Minnesota law, including that the individual defendants allegedly breached fiduciary duties in
providing for excise tax reimbursements to certain individuals who were and/or are directors and executive officers of
Medtronic, Inc. in connection with the then-potential acquisition of Covidien. In October of 2014, the Houston and Clark
matters were consolidated and the plaintiffs filed a preliminary injunction motion seeking to enjoin the Company from the
payment of the excise tax reimbursements. On December 16, 2014, the Court heard the preliminary injunction motion and on
December 22, 2014, the Court denied the preliminary injunction motion. On January 6, 2015, the Company consented to
plaintiffs’ request to voluntarily dismiss the matter without prejudice. On January 7, 2015, the Court entered its order of
dismissal, bringing these matters to a conclusion.
Putative shareholder class action complaints have been filed in the United States District Court for the District of Massachusetts
by purported shareholders of Covidien under the captions Taxman v. Covidien plc, et al., 14-cv-12949, Lipovich v. Covidien plc,
et al., 14-cv-13308 and Rosenfeld Family Foundation v. Covidien plc, et al., 14-cv-13490. On October 20, 2014, the plaintiff in
the Rosenfeld action and another purported shareholder of Covidien filed a motion seeking to consolidate
the Taxman, Lipovich and Rosenfeld actions, and on November 14, 2014, the United States District Court for the District of
Massachusetts granted that motion consolidating the actions (the Consolidated Action). On December 23, 2014, the defendants
reached an agreement in principle with plaintiffs in the Consolidated Action, and that agreement is reflected in a memorandum
of understanding. In connection with the settlement contemplated by the memorandum of understanding, Covidien agreed to
make certain additional disclosures related to the Transactions, which are contained in Covidien’s Report on Form 8-K filed on
December 23, 2014. The memorandum of understanding contemplates that the parties will enter into a stipulation of settlement.
A stipulation of settlement was filed with the court on May 15, 2015, and a hearing will be scheduled at which the United States
District Court for the District of Massachusetts will consider the fairness, reasonableness, and adequacy of the settlement,
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