German drugs firm Bayer has launched a court case against rival Merck KGaA, accusing it of trying to illegally block a takeover bid for Schering.
Merck has been building its stake in Schering recently
Bayer wants a court to force Darmstadt-based Merck to sell off a recently acquired stake in Schering.
It also alleges that Merck broke US securities rules by failing to disclose the purchase.
Bayer claims Merck will use the stake to vote against its 16.5bn euro ($20.3bn) takeover bid for Schering.
"As a result of Merck's violations, investors - including Bayer - were unaware that Merck was plotting to derail Bayer's tender offer and thus deprive Schering's shareholders of the opportunity to sell their shares at a significant premium," the lawsuit says.
The case has been filed in the US District Court of Manhattan as approximately 19% of Schering's stock is held in the US, according to the Bayer claim.
Merck has built up a 21.8% holding in German drug group Schering, buying most of the stake in recent days.
The Merck company, based in the German state of Hesse, no longer has any connection with the US pharmaceutical firm of the same name.
The US-based Merck was originally a subsidiary of the German company, but became independent after World War I.
German Merck's latest purchase of 2.1 million Schering shares was disclosed in a filing to the US Securities and Exchange Commission after the lawsuit was launched.
Meanwhile, Bayer has hinted it may raise its 16bn euro offer in order to seal a deal with Schering and end an aggressive tussle with Merck.
If the Bayer-Schering deal does go through, it would create a healthcare group with sales of over 15bn euros.