LAWFUEL – The UK Legal Newswire – A regional UK pension fund has been appointed to spearhead a US class-action lawsuit against GlaxoSmithKline (GSK), accusing the pharmaceutical giant of misleading the market over its controversial diabetes pill Avandia, the Times reports.
Avon Pension Fund, which manages about £1 billion on behalf of public sector workers, was appointed “lead plaintiff” — a US term for the institution fronting a group lawsuit on behalf of other investors — over the weekend.
Although both private and public pension funds in the UK are showing an increasing interest in US class-action lawsuits, it is rare for them to take such a prominent role.
In the GSK lawsuit — which accuses the group of “fraud” and “deceit” by withholding information about the risks of Avandia — Avon was competing with the North Yorkshire Pension Fund for the role of lead plaintiff.
A US public pension fund and a group of German investors, including a subsidiary of Barclays Bank, also applied to be lead plaintiff, according to court papers seen by Times Online.
A judge in the United States District Court for the Southern District of New York appointed Avon because it had the second-largest financial interest in the case.
The German shareholder group had the largest exposure to GSK shares but was passed over for the role of lead plaintiff because of continuing uncertainty over whether German courts can enforce a US class-action ruling.