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LITIGATION
9 Months Ended
Sep. 30, 2014
Commitments and Contingencies Disclosure [Abstract]  
NOTE 14. LITIGATION

In February 2014, Patrick T. Mooney, M.D., our former President and Chief Executive Officer, and his wife, Elizabeth Mooney, filed a complaint against the Company and certain of its Directors and Officers in the Court of Common Pleas in Philadelphia County.  The complaint, which alleges (i) that Dr. Mooney’s termination was without cause so that he is entitled to certain severance benefits under his employment agreement and associated statutory remedies; (ii) that certain legally required disclosures by the Company and its General Counsel defamed Dr. Mooney; and (iii) that Dr. Mooney’s wife is entitled to damages under a theory of loss of consortium, seeks in excess of $20 million in damages.  The Company denied the allegations of the complaint and asserted counterclaims against Dr. Mooney based upon the same conduct which provided the cause for his termination.  Thereafter, the Company withdrew three of the counterclaims after concluding that Dr. Mooney’s personal financial condition was unlikely to permit recovery of the advanced defense costs he had demanded or such damages as the Company might ultimately recover and that the expenditure of cash necessary to prosecute those affirmative claims was best conserved for other corporate purposes.  The Company believes it has strong defenses to the claims asserted and intends to defend them vigorously.  The Company similarly believes that it has strong support for its remaining counterclaim.

 

In July 2014, Dr. and Mrs. Mooney filed another complaint in the Court of Common Pleas in Philadelphia County against the Company, certain of its directors and Officers and a former Director and officer alleging (i) wrongful use of civil proceedings and (ii) abuse of process in the original filing of the counterclaims withdrawn in the earlier action.  Mrs. Mooney also asserted another claim for loss of consortium.  This complaint seeks in excess of $30 million in damages.  The Company has denied the allegations.  The Company believes that this action is without merit, that it acted lawfully and in good faith, and that it has strong defenses to the claims asserted.  Accordingly, the Company intends to vigorously defend against this lawsuit.

 

In August 2014, Dr. Mooney filed a complaint in Delaware Chancery Court against the Company for advancement of defense costs related to his February 2014 complaint, many of which the Company had paid to date and the remainder of which were subject to a good faith dispute that counsel for the Company and Dr. Mooney had been attempting to amicably resolve.  Dr. Mooney also demanded that the Company pay for his attorneys fees related to his July 2014 complaint against the Company, amongst other matters.  The Company filed a Motion to Dismiss this complaint and is awaiting the Court’s ruling.

 

In September 2014, Platinum Partners Value Arbitrage Fund L.P. (“Platinum Partners”) filed a complaint in Delaware Chancery Court against the Company seeking inspection of certain of the Company’s books and records. The Company responded to the complaint on October 7, 2014. On November 17, 2014, the Company and Platinum Partners filed a Joint Stipulation of Dismissal, and this matter is now concluded.

 

In October 2014, Platinum filed a complaint in Delaware Chancery Court against the Company seeking inspection of the Company's stocklist and certain of the Company’s books and records. The Company responded to the complaint on October 24, 2014. On November 10, 2014, the Company and Platinum Partners filed a Joint Stipulation of Dismissal, and this matter is now concluded.

 

On October 31, 2014, Platinum Partners filed a complaint in Delaware Chancery Court against the Company and three of its directors seeking, among other things, a declaration that certain of the Company's bylaws are invalid and that the three directors breached their fiduciary duties and an order requiring the Company to hold a special meeting at which the stockholders can vote on whether to remove the three directors. The Company believes that Platinum Partners' request for relief is without merit and intends to contest the suit vigorously.