Henry Schein (NSDQ:HSIC) said today it expects to pay approximately $38.5 million to settle an anti-trust class action suit related to dental supplies.
The case, which was filed in the US District Court for the Eastern District of New York, alleges that the defendants violated anti-trust rules by fixing prices on dental equipment and supplies, as well as other claims.
The Melville, N.Y.-based company said that it expects to incur a charge of $38.5 million in pre-tax money, or 19¢ per share, to settle the case.
The charges are slated to go on the books for the company’s third quarter, though the settlement is subject to a definitive agreement amongst all engaged parties, as well as court approval. Co-defendants Patterson (NSDQ:PDCO) and Benco Dental also expect to settle, Henry Schein said in its press release.
“We categorically and emphatically deny any wrongdoing, and we have made a business decision in the best interests of the Company to engage in settlement discussions to avoid long, distracting litigation and the additional use of resources. We have a long history of serving customers with integrity and honesty, and we have earned our reputation for doing business ethically in a competitive business environment,” board chair & CEO Stanley Bergman said in a press release.
Shares in Henry Schein have fallen 4.6% so far today, at $77.34 as of 11:04 a.m. EDT.
In February, the U.S. Federal Trade Commission filed a complaint against Henry Schein, Patterson and Benco alleging violations of US antitrust law by conspiring to refuse to provide discounts to or to serve buying groups representing dental practitioners.
The three companies, which the FTC claims control more than 85% of all dental product distributor sales in the US, face allegations that they denied independent benefits of such buying groups to dental practices mostly composed of small businesses, including solo or small groups of dentists.
