The lawsuit was filed by Allergan on August 4
The ruling questioned the bylaws that governed Valeant’s directors, stating that the matter would be one for the state courts, rather than the district lawmakers.
“Even if the bylaws did have such a requirement, however, the Court would be reluctant to create a precedent that allows corporations to demand at will the immediate attention and input of the federal courts in order to resolve intra-corporate disputes that might be better left to the dynamic free market or to the state court,” the California district court ruling stated.
“We are pleased that this attempt by Allergan in the California litigation to delay the special meeting was not successful,” a Valeant spokesperson said about the legal decision.
Allergan still fighting
Allergan is doing everything it can to fend off the hostile bid, and is said to be in negotiations with other companies at the current time.
Last week a Wall Street Journal article alleged that Allergen is currently in talks with Salix Pharmaceuticals and at least one other company are currently in talks to strike up an alternative deal to the hostile Valeant bid.
According to the report, there is no certainty of how advanced the Salix talks are, but it did state that a takeover deal with the company or the alternative buyer could be brokered by as early as next month.
The Valeant offer
In a long-running saga, Valeant said it was aiming to buy a controlling stake in Botox-maker Allergan back in June, when it offered shareholders a combination of cash and Valeant shares.
Valeant’s strategy is part of a hostile takeover bid estimated to be worth $53bn, which will allow the pharmaceutical giant and its financial partner Pershing Square Capital Management to take over the lucrative business.
At the end of May, Valeant made a bid for the company that was rejected, but two weeks later the company has decided to approach the situation with what it terms as an ‘exchange offer for the common stock of Allergan’.
This offer to Allergan shareholders includes a combination of cash and Valeant shares.