Faruqi & Faruqi, LLP Announces Class Action Lawsuit
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The action alleges that the Company and its executives violated federal securities laws by failing to disclose that: (1) China Med’s acquisition of Bio-Ekon Biotechnology Co. Ltd. was from a third-party seller connected to the Company’s own chairman; (2) China Med overpaid by an estimated $20 million in the acquisition of BBE; (3) China Med’s transaction to acquire BBE involved the Company’s use of fraudulent shell companies, including Finnea International Limited which never owned BBE; (4) according to SAIC filings, BBE actually suffered operating losses prior to China Med’s acquisition; and (5) the Company has spent twice as much on “investing activities” as it has purportedly generated from operations.
On December 6, 2011, Glaucus Research Group released a report focusing on the Company’s fraudulent acquisition of BBE and initiating a strong sell for China Med. On this shocking news, China Med shares plunged roughly 23% at the end of trading on December 6, 2011.
If you purchased China Med securities and would like to discuss your legal rights, visit www.faruqilaw.com/CMED. You can also contact us by calling Richard Gonnello or Francis McConville toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to rgonnello@faruqilaw.com or fmcconville@faruqilaw.com. Faruqi & Faruqi, LLP also encourages anyone with information regarding China Medical’s conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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Workers’ Compensation Subrogation of Administrative Fees and Costs
When a worker covered by workers’ compensation makes a claim against a third party, the workers’ compensation insurance retains the right to subrogate against any recovery from that third party for all benefits paid to or on behalf of a claimant injured at work. When subrogating for more than basic medical and indemnity benefits, the Texas workers’ compensation subrogation statute provides that “the net amount recovered by a claimant in a third‑party action shall be used to reimburse the carrier for benefits, including medical benefits that have been paid for the compensable injury.” TX Labor Code § 417.002.
In fact, all 50 states provide for similar subrogation. However, none of them precisely outlines which payments or costs paid by a compensation carrier constitute “compensation” and can be recovered. The result is industry-wide confusion and an ongoing debate and argument with claimants’ attorneys over what can and can’t be included in a carrier’s lien for recovery purposes.
In addition to medical expenses, death benefits, funeral costs and/or indemnity benefits for lost wages and loss of earning capacity resulting from a compensable injury, workers’ compensation insurance carriers also expend considerable dollars for case management costs, medical bill audit fees, rehabilitation benefits, nurse case worker fees, and other similar fees. They also incur other expenses in conjunction with the handling and adjusting of workers’ compensation claims. Workers’ compensation carriers typically assert, of course, that, they are entitled to reimbursement for such expenditures when it recovers its workers’ compensation lien. Injured workers and their attorneys disagree.