Shareholders Launch Fraud Suit Against ArthroCare

Law360, New York (October 20, 2008, 12:00 AM EDT) -- Shareholders of ArthroCare Corp. have accused the medical device company of committing securities fraud when it inflated the company's value by selling a spinal surgery device to doctors through an illicit scheme that involved patient referrals by personal injury lawyers.

In the purported class action lodged in the U.S. District Court for the Southern District of Florida, the shareholders blame the company for the drop in their stock value from $65.70 to $23.21, resulting in millions of dollars in shareholder losses.

The drop came after the...
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