Suit by Allergan Shareholders Dismissed : Courts: Federal judge disallows their claim that the Irvine company overstated its business prospects.

Allergan Inc. said Monday that a federal judge has dismissed a class-action lawsuit brought by shareholders who accused the company of being overly optimistic in its predictions of business success.

U.S. District Judge Alicemarie H. Stotler issued a summary judgment to dismiss the lawsuit, which had consolidated about 20 lawsuits in Santa Ana and Philadelphia filed shortly after Allergan completed its first public offering in 1989.

Another lawsuit filed in the wake of these is pending before Stotler, said Allergan spokesman Michael Timmermann, but he said the company believes the latest ruling will result in it, too, being dismissed.

Irvine-based Allergan, which makes eye- and skin-care products, said the ruling validates its earlier assertion that the shareholder lawsuits were without merit.

“We maintained from the outset that these allegations were unfounded. We are pleased the court has agreed with our position,” said Allergan President William C. Shephard. Lawyers for the plaintiffs could not be reached for comment.

Besides saving the company from further protracted litigation, Stotler’s ruling allows Allergan to recoup certain court costs and fees, which are being determined, Timmermann said.

Allergan stock closed Monday at $21.875 a share, down 12.5 cents, in trading on the New York Stock Exchange.

The lawsuits were filed in the fall of 1989 after Allergan revised its projected sales by suggesting that its growth would not be as robust as earlier predicted, resulting in a 15% stock price drop to $20.75 a share. Plaintiffs alleged in the Philadelphia lawsuits that company executives violated securities law by issuing statements that lulled the public into false expectations about the company’s success.

Plaintiffs included Melrose Investment Group, Plato Paper Products Inc. and individual investors Hyman and Elaine Greenspan. Allergan was spun off from Philadelphia-based SmithKline Beckman in July, 1989, when the latter company merged with a British company to form SmithKline Beecham.