Judge Cans NutriSystem Derivative Action

Law360, New York (October 27, 2009, 3:22 PM EDT) -- Having already failed to make headway in a putative class action alleging NutriSystem Inc. misled investors about its prospects and inflated its stock price, shareholders have fared little better in taking the weight-loss company’s brass to task over the company's downturn in 2007.

Judge Mary A. McLaughlin of the U.S. District Court for the Eastern District of Pennsylvania on Monday dismissed the consolidated derivative action, concluding that the complaint failed to prove that a presuit demand on the NutriSystem board would have been futile.

Deeming the...
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