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FEDERAL JUDGE FINDS THAT KHAN LIED UNDER OATH; TRADED ON INSIDER INFORMATION; FAILED TO DISCLOSE MATERIAL INFORMATION IN FILINGS

 Judge Issues Injunction Forbidding Broker from Seeking to Take
 Control of ICN Pharmaceuticals Through Any Means
 NEW YORK, May 18 /PRNewswire/ -- U.S. Federal Judge John Sprizzo has issued a sweeping injunction stopping a stockbroker from seeking to take control of ICN Pharmaceuticals Inc. (NYSE: ICN) through any means. The ruling comes as a result of a federal lawsuit brought against the broker by ICN.
 In addition to imposing the injunction, Sprizzo said that the broker, Rafi Khan, had willfully lied under oath during the hearing on the case and provided testimony that was "false and willfully false ... I thought he committed willful perjury in this court under oath," said Sprizzo. "I believe Mr. Khan to have lied under oath in this courtroom, and I so find for the record."
 Sprizzo also found that Khan had engaged in insider trading. "I find that in fact he was trading on inside information ..." said Sprizzo. "I think the record supports an inference that there was inside information available to Mr. Khan and that he acted upon that information, as his stock transactions reflect, in his efforts to use whatever leverage he had as a result of that inside information to benefit himself."
 The judge went on to enumerate a range of failures by Khan to disclose material information in his filings with the Securities and Exchange Commission. "The court finds for the record that there are many material nondisclosures in the consent statement."
 The judge took note of Khan's failure to include in his SEC filings the fact that Khan was part of a group. "Therefore, I find as a matter of fact that he was part of a group which had undertaken to finance him ..." The judge noted that Khan's shifting testimony regarding his representation of other shareholders in the attempt to take control of ICN, "... another example, it seems, of Mr. Khan's shifting view of the truth, depending on what his interest is at the moment." The judge further said, "I conclude therefore ... that Mr. Khan was in fact representing a group. His failure to disclose that in the statements, in my view, makes the statements materially false and, I think, based upon the evidence, designedly so. That is a most material nondisclosure."
 In his ruling, Sprizzo found that Khan was in law and in fact a fiduciary of ICN. The judge found Khan was breaching that fiduciary responsibility. "... that is more than sufficient to, in my view, place upon him a fiduciary responsibiity to the company which forecloses him at this point and time from seeking to effect a change of management and to benefit himself personally thereby.
 "For all of the reasons I have given, I will issue an injunction preventing Mr. Khan, directly or indirectly, or anyone acting on his behalf or with him, from seeking to effect a changeover of this company, by consent or otherwise," said Sprizzo. "My injunction is now broader than it was before, because if Mr. Khan is breaching a fiduciary responsibility in taking over the company by consent, it seems to follow, as the night the day, that he is also precluded from seeking to take over the company by a proxy solicitation."
 ICN attorney Arnold I. Burns, a senior partner of Proskauer, Rose, Goetz & Mendolsohn and former deputy attorney general of the United States, commented on the judge's ruling, "The ruling by Federal Judge John Sprizzo confirms that this broker, for no purpose other than personal enrichment, secretly and unlawfully sought to take advantage of the situation that arose when ICN Chairman and Founder Milan Panic took a leave of absence from the company to help bring freedom and democracy and free-market reforms to one of the most troubled parts of the world, Yugoslavia and Bosnia.
 "With this matter of tragic betrayal behind it, the company will continue to proceed with the long-term growth plans that have been set under the leadership of Mr. Panic and his board of directors," Burns said. "These include expansion into Eastern Europe, development of the company's patented antiviral Virazole for hepatitis C, expansion into new and existing pharmaceutical markets throughout the world, and the continued building of its subsidiary companies."
 -0- 5/18/93
 /CONTACT: Arnold I. Burns, Esq., 212-969-3000/
 (ICN)


CO: ICN Pharmaceuticals Inc. ST: New York IN: SU:

MS -- LA023 -- 9915 05/18/93 15:50 EDT
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Publication:PR Newswire
Date:May 18, 1993
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