Mallinckrodt Executives Fail to Shake Class Action Investor Suit

Mallinckrodt Public Limited Co. officers must face a proposed class action alleging executives at the pharmaceutical company misled investors about the financial strength of the company, a federal judge ruled.

The complaint “clearly and in detail sets forth the alleged materially false and misleading statements made by Defendants, and provides explanations as to why those statements are misleading,” Judge Zahid N. Quraishi said Monday in an opinion for the US District Court for the District of New Jersey, denying Mallinckrodt’s motion to dismiss.

The court setback for Mallinckrodt comes in the wake of the company’s Sept. 19 agreement to ...