Company: NOTV
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001628280-25-023370
Chunk: 152

Company: Inotiv, Inc.
Filing Date: 2025-05-08
Form: 10-Q
Item: Part II, Item 8
Chunk 152
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 discrete adjustments related to the Agreement in Principle (subsequently replaced by the Resolution Agreement and Plea Agreement) and changes in valuation allowance, partially offset by a change in the Company's forecasted loss before income taxes. The Company’s effective tax rates for the six months ended March 31, 2025 and 2024 were 7.2% and 13.4%, respectively. For the six months ended March 31, 2025, the Company’s effective tax rate was primarily driven by a change in the valuation allowance. For the six months ended March 31, 2024, the Company’s effective tax rate was primarily driven by unfavorable permanent items related to the Agreement in Principle (subsequently replaced by the Resolution Agreement and Plea Agreement) and valuation allowance adjustments.

12.    CONTINGENCIES AND COMMITMENTSLitigationEnvigo RMS, LLC (“Envigo RMS”) is a defendant in a purported class action and a related action under California’s Private Attorney General Act of 2004 (“PAGA”) brought by Jacob Greenwell, a former non-exempt employee of Envigo RMS, on June 25, 2021 in the Superior Court of California, Alameda County. The complaints allege that Envigo RMS violated certain wage and hour requirements under the California Labor Code. PAGA authorizes private attorneys to bring claims on behalf of the State of California and aggrieved employees for violations of California’s wage and hour laws. The class action complaint seeks certification of a class of similarly situated employees and the award of actual, consequential and incidental losses and damages for the alleged violations. The PAGA complaint seeks civil penalties pursuant to the California Labor Code and attorney’s fees. On June 2, 2023, Envigo RMS and the plaintiff signed a Memorandum of Understanding (“MOU”) that sets forth the parties’ intent to settle these matters for $795 which includes attorneys’ fees. On August 2, 2024, the parties entered into a Joint Stipulation of Class Action and PAGA Settlement and Release of Claims (the “Agreement”) that incorporated the material terms of the MOU and is subject to court approval. The Agreement contains no admission of liability or wrongdoing by Envigo RMS. The Agreement provides that, if the settlement is approved by the court, the settlement amount would be paid in four quarterly installments, with the first one to be funded after the court’s final approval of the settlement, and the following ones in the three subsequent quarters. A motion for