Walgreens Boots Alliance to pay $595M to settle Everly/PWN claims

According to a regulatory filing, as initially disclosed in the Quarterly Report on Form 10-Q of Walgreens Boots Alliance (WBA), Inc. for the quarterly period ended February 29, 2024, Everly Health Solutions, formerly known as PWNHealth LLC, initiated an arbitration on June 10, 2022 with the American Arbitration Association alleging that an agreement between Everly/PWN and the Company was exclusive, and that the Company breached the agreement when it in-sourced certain enabling services previously performed by Everly/PWN related to the ordering and oversight of Covid testing. Everly/PWN also alleged fraudulent inducement, misappropriation, and improper use of PWN’s mark. Everly/PWN sought monetary damages for its alleged claims. On March 19, 2024, the arbitrator issued a final award in the amount of $988M, including pre-award interest. The Company disputed the alleged claims and the Arbitration Award in part because it believes it is in contravention of a contractual cap on damages in the agreement, which limits damages to $79M. On March 19, 2024, the Company filed a petition in federal court in Delaware to vacate the Arbitration Award. Everly/PWN filed a petition to confirm it. On February 10, 2025, the federal court in Delaware upheld the Arbitration Award by granting Everly/PWN’s motion to confirm the award and denying the Company’s motion to vacate the award. On February 24, 2025, the Company entered into a settlement agreement with Everly/PWN, pursuant to which the parties agreed to resolve all claims related to the Everly/PWN Action. Under the terms of the Settlement Agreement, the Company will pay Everly/PWN $595M, payable within two business days. Both parties will then file a joint stipulation with the court, dismissing all claims against the Company, including any claims to enforce the Arbitration Award. The Company entered into the Settlement Agreement to avoid the continued accrual of post-award interest on the Arbitration Award and the cost and uncertainty of continued litigation. The Settlement Agreement includes no admission of wrongdoing or liability by the Company.