Grifols started legal action vs. Gotham City in the United StatesAs reported by the company in a relevant information sent to the CNMV after the market closed this Friday. The pharmaceutical company alleges that the bearish fund took advantage of the Catalan group’s short position in the company by distributing a report containing lies about accounting, communications and finance. Some sources state that the fund pocketed 20 million euros through the operation. For this reason, the blood products giant, the fund’s manager and founder Daniel Yu, General Industrial Partners, Cyrus de Weck and the companies it invests in demand “compensation for the financial and reputational damages” caused to the company and related parties. Reports questioning solvency and accounting.
A week ago, Grifols hired American law firm Proskauer to take legal action against Gotham City in the United States.The fund accused him of falsifying its accounts in early January, causing up to 40% of the company’s shares to collapse. The pharmaceutical group is now suing the bearish fund and its top executives, Daniel Yu and Cyrus de Weck, for “libel and market manipulation.” Also to General Industrial Partners, the venture capital fund through which they operate. The company left up to 32 percent of its value in the stock market following accusations that its accounts had been manipulated, and so it asked the United States District Court for the Southern District of New York to order the defendants to pay it to “recoup the data.” “Financial and reputational damage to the company and its parties” states the relevant fact sent to the CNVM. Grifols also seeks injunctive relief so that the defendants do not back down and persist in their actions.
Responsible for illegal behavior
Grifols also filed a motion before the New York court demanding that the defendants be held “fully responsible” for the “illegal conduct” alleged in the lawsuit. Grifols closed this Friday up 1.7% to 9,560 euros. recorded a weekly increase of 14.24%. Although Grifols shares rebounded throughout the week, Its price is still 30% below pre-crisis levels due to a report by Gotham City Research, which has fallen, accusing the company of manipulating its books.
The company initiated this legal action the same week that the National Securities Market Commission (CNMV) launched it. Began analyzing information Grifols submitted regarding various aspects of his accountingAmong these are the Catalan company’s connections to the Scranton ‘family office’. “As with such processes, the analysis involved may require the collection of clarifying or supplementary information and, given the complexity of the issues it deals with, may take several weeks before a specific date can be set for its conclusion,” it said. The supervisory body, which has the firm determination to make it public, said in a statement last Tuesday:
“Of course this is not possible, there is no evidence to date to predict these outcomes or corresponding actions at the current stage, “Given publicly available information, Grifols’ published and audited information does not comply with regulations,” it said.
Beyond reviewing Grifols’ financial information, CNMV also analyzes the behavior of the Gotham fund in terms of the content of the report, its distribution pattern and related market transactions.. According to the supervisory body, the aim is to determine whether such behavior complies with European rules on market abuse, in particular the rules on the dissemination of misleading information.