Merck Gets Sued by PETA Over Shareholder Proposal

Merck Gets Sued by PETA Over Shareholder Proposal

April 3rd, 2012 // 12:19 pm @

For the second consecutive year, the People for the Ethical Treatment of Animals has filed a lawsuit against Merck over a shareholder proposal that the animal-rights group wants included in the annual proxy statement. At issue is a proposed requirement that the drugmaker disclose its use of animal testing in all research.

Specifically, PETA wants the drugmaker to generate an annual report on its “procedures to ensure proper animal care, including measures to improve the living conditions of all animals used in-house and at contract laboratories.” The animal-rights group wrote Merck last November seeking to have its proposal included in the proxy statement.

Merck, however, recently rejected the request and solicited a response from the US Securities and Exchange Commission, which is not planning to take any action to force the drugmaker to include the PETA proposal. The animal-rights group, meanwhile, is also seeking a temporary restraining order so that proxy materials include the proposal in time for the May 22 annual shareholder meeting.

The proposal that PETA wrote for the Merck proxy states that the drugmaker was “repeatedly cited by the government for improper care” of animals used in experiments and more than 2,000 were not given pain relief. The proposal also states that animals were subject to “sadistic treatment” by a contract lab used by Merck and that 14 felony cruelty charges were allegedly filed against lab employees.

In rebuffing PETA, Merck argues the shareholder proposal contains various false statements, according to the PETA lawsuit. We have asked Merck for a comment and will update you accordingly. Meanwhile, here is the PETA lawsuit and the request for a temporary restraining order. [UPDATE: A Merck spokesman writes us this: “”We are aware of the shareholder lawsuit filed by PETA and we believe the plaintiff’s claims are without merit.”]

Last year, by the way, Merck argued that, since it merged with Schering-Plough in 2009, PETA had to prove ownership in Schering-Plough. Merck insisted Schering-Plough was the surviving entity because a reverse merger took place. However, PETA noted the drugmaker is still called Merck; Merck execs run the organization, notably ceo Ken Frazier; the headquarters are located where Merck has always been headquartered and former Schering-Plough ceo Fred Hassan quickly departed. Nonetheless, PETA failed to have its proposal included in the proxy last year (back story).

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