An investigation on behalf of current investors Chattem Inc. (Public, NASDAQ:CHTT), who purchased the CHTT shares before December 21, 2009, over potential breaches of fiduciary duty and other violations of state law in connection with an alleged unfair takeover price was announced.

The investigation by a law firm focus on potential breaches of fiduciary duty and other violations of state law by the Board of Directors of Chattem Inc. arising out of their attempt to sell Chattem Inc. (NASDAQ:CHTT) to Sanofi-Aventis. On December 21, 2009 Chattem, Inc and Sanofi-Aventis announced that they have entered into a definitive agreement under which Sanofi-Aventis will acquire 100 percent of the outstanding shares of Chattem (NASDAQ:CHTT ) in a cash tender offer for $93.50 per share, or approximately $1.9 billion. According to Chattem, Inc Board of Directors has unanimously approved the transaction and the offer price represents a 34 percent premium above the closing price of Chattem's shares on December 18, 2009 and a 44 percent premium above the average closing price of Chattem's shares during the 6 months preceding the announcement of the transaction.

But according to an investigation by a law firm the transaction appears to be unfair to current investors of Chattem Inc. (Public, NASDAQ:CHTT) because the offer to purchase Chattem Inc. (CHTT) appears opportunistically timed to take advantage of the current economic downturn and is grossly unfair, inadequate, and substantially below the fair or inherent value of CHTT.

Shares of Chattem Inc. traded after the announcement at $92.94 per share, and the day before the news at about $70 per share.

The investigation concerns whether the Chattem Inc. Board of Directors breach their fiduciary duties to Chattem Inc. (CHTT) shareholders by agreeing to sell Chattem Inc. at an unfair price thereby harming Chattem Inc. and its shareholders, whether the directors of Chattem Inc. may have breached their fiduciary duties by not acting in Chattem Inc. shareholders' best interests, and the Company may not have adequately shopped itself around before entering into this transaction and, pursuant to this proposed transaction, Sanofi-Aventis may be underpaying for Chattem Inc, thus unlawfully harming CHTT shareholders.

Chattem, Inc., located in Chattanooga, TN is a marketer and manufacturer of a portfolio of branded over-the-counter (OTC) healthcare products, toiletries and dietary supplements, in such categories as medicated skin care products, topical pain care, oral care, internal OTC, medicated dandruff shampoos, dietary supplements, and other OTC and toiletry products. Chattem Inc. reported in 2007 Total Revenue of $423.38million with a Net Income of $59.69million and in 2008 Total Revenue of $454.88million with a Net Income of $66.29million.