By Toni Clarke and Tim McLaughlin
BOSTON, Nov. 21 (Reuters) - A federal judge on Wednesday
denied a motion to freeze the assets of the owners of the
compounding pharmacy at the heart of the deadly U.S. meningitis
outbreak, but said the company may not make extraordinary cash
transfers or pay dividends or bonuses to the pharmacy's owners.
Judge Dennis Saylor, of U.S. District Court in Boston,
ordered an attachment of $5 million for each of the two
plaintiffs who had moved for a preliminary injunction and
prejudgment attachment restraining the assets of the Framingham,
Massachusetts-based New England Compounding Center.
An attachment represents a preliminary seizure of property
pending a final judgment in a case.
The plaintiffs, Michele Erkan and Robert Cole, who have
filed a lawsuit against NECC, had also sought to freeze the
assets of NECC-affiliated companies Medical Sales Management Inc
and Ameridose LLC and six individual directors, shareholders and
employees, up to $461 million.
These included Barry Cadden, NECC's co-owner and chief
pharmacist; his brother-in-law Gregory Conigliaro, who is also
an NECC co-owner; and other members of the Conigliaro family who
are principals of the companies.
On Tuesday lawyers for NECC's owners argued before Saylor
that there is no evidence any of them directly participated in
the events that led up to the meningitis outbreak. They argued
to block the motion by the meningitis victims to freeze assets
of NECC and its owners.
According to the Centers for Disease Control and Prevention,
490 people have been injured by a tainted steroid distributed by
NECC and 34 have died.
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