WEST VIRGINIA RECORD

MORGANTOWN -- Mylan Pharmaceuticals is suing the Pittsburgh Post-Gazette again, this time for libel.

On July 26, the front page of the Pittsburgh Post-Gazette featured an article with the heading "Mylan workers overrode drug quality controls; Internal report detailed 'pervasive' practice of ignoring safety procedures," according to a complaint filed Oct. 30 in Monongalia Circuit Court.

Mylan claims the article was positioned as an objective news report, but that it "contained the sort of sensationalism, exaggeration and outright falsehood that typifies the world kind of tabloid journalism."

The day following the publication of the article, an unusually high volume of Mylan's stock was traded and the stock price experienced dramatic fluctuations, according to the suit, and for the next several weeks the Pittsburgh Post-Gazette continued to public numerous articles that reported the same matter.

Patricia Sabatini and Len Boselovic are Pittsburg Post-Gazette staff writers and appear in the article's byline, according to the suit.

Mylan claims the Pittsburgh Post-Gazette and its staff writers intentionally and misleadingly committed, juxtaposed and distorted the facts to persuade readers that Mylan engages in activity that would result in adverse Federal Food and Drug Administration action.

After FDA inspections at the Morgantown plant relating to the allegations in the Pittsburgh Post-Gazette article, the FDA did not find any problems with product quality.

Mylan, Inc. and Mylan Pharmaceuticals are suing for general, special, punitive and exemplary damages for libel. Barry B. Langberg and Deborah Drooz of Brownstein Hyatt Farber Schreck, LLP in Santa Barbara, Calif.; and Charles J. Crooks of Jackson Kelly, PLLC, in Morgantown, are representing Mylan.

Mylan and the Post-Gazette have a history.

In August, Mylan filed a federal lawsuit against the Post-Gazette, claiming the July 26 Post-Gazette story written by Sabatini and Boselovic was based primarily on a "confidential internal report" that was wrongfully obtained and mischaracterized. Mylan believes the defendants have other confidential materials that are protected both by attorney-client and work product privilege "and are so labeled in bold type."

The Post-Gazette has asked the U.S. District Court to dismiss that complaint, saying it had a constitutional right to publish an article that led to an investigation by the Food and Drug Administration.

The Pittsburgh Post-Gazette claims the only reason Mylan filed the lawsuit Aug. 19 was to obtain confidential sources used in the story.

The July 26 article revealed the outcome of an internal investigation conducted by Mylan. In the investigation, Mylan discovered workers at its Morgantown plant were routinely overriding computer-generated warnings about potential problems with medications they were producing, according to the article.

Mylan says facts in the article are misconstrued and that the article's publication has since affected its stock value.

"The article also contains numerous statements that adversely affect the business reputation of Mylan; impugn the integrity of its manufacturing and quality control procedures; impugn the integrity of management personnel; and thereby threaten current and prospective business relationships in the highly competitive market of generic pharmaceuticals," Mylan's suit states. It goes on to say the Post-Gazette story and follow-up articles are "sensational and misleading articles based on improperly obtained and misconstrued confidential, proprietary and/or privileged internal documents" creating the "false appearance" of quality and regulatory issues.

Before that, when Mylan announced the promotion of Heather Bresch to COO in 2007, she said she had an MBA degree from West Virginia University. The newspaper had a story later questioning the degree.

A panel later concluded that WVU officials falsified Bresch's academic records to make it seem as if she finished the degree.

"The changes included adding 22 credits and grades 'pulled from thin air' to her transcript," the Post-Gazette later reported. "Officials then awarded her a degree retroactively that she did not earn."

After the report, Bresch's degree was revoked. And WVU President Michael Garrison, the university's provost and business school dean resigned.

Monongalia Circuit Court case number: 09-C-807