Dublin, Ohio-based Cardinal Health has set aside a $600 million cash reserve to help cover anticipated settlement fees associated with a pending class-action securities lawsuit. The lawsuit is related to a Securities and Exchange Commission investigation that determined Cardinal employed misleading financial reporting and disclosure practices in its pharmaceutical distribution business between 2000 and 2004.
According to a company news release, while Cardinal officials have established the fund in anticipation of a mediated settlement, representatives have no guarantee the reserve will be sufficient should a settlement be reached, and no indication of the potential terms or final court approval of an agreement.
The reserve is expected to lower Cardinal Healths third-quarter after-tax earnings, which are scheduled to be released Thursday, by $384 million dollars. -- by Shawn Rhea