Organovo sued and won its case. Simeon "Research"was ordered by the court to remove all of its libelous statements from distribution on the internet. Simeon opposed Organovo’s case, but Simeon’s counsel resigned during the case and Simeon did not respond to the Complaint after its counsel’s resignation. The Delaware Court of Chancery ultimately found against Simeon, requiring that Simeon remove all libelous statements from its website, Twitter account, or any other public websites and prohibiting Simeon from making further defamatory statements about Organovo or publishing libelous statements about Organovo on the Internet.
During the course of the case, Organovo received information suggesting that Simeon Research was not a long short equity analytical research fund. Rather, there was a single individual who was the sole founder, owner, and employee of Simeon involved with Simeon in any capacity. Organovo believes that this individual created a false corporate front rather than using a previously-existing Seeking Alpha profile in an attempt to deceive his audience and to hide and protect himself due to an intention to profit by trading in Organovo derivatives while distributing the information. He used an alias to communicate with Seeking Alpha, which declined to publish Simeon’s submission. The individual had taken a large short position in the form of derivatives on Feb 19, 2014, first published Simeon’s purported research on Feb 20, 2014, and exited the majority of his short position on Feb 21, 2014 with tremendous gains. In the two-week period prior to the release of Simeon’s second report in April 2014, he built up another short position in derivatives, which he exited within approximately one week of issuance of the second report.
The individual attempted, again using an alias, to achieve wide distribution of the libelous materials. Fortunately, these attempts were not entirely successful. Some websites voluntarily removed the material, and Seeking Alpha rejected it outright. Seeking Alpha’s rejection read as follows: “Thank you for the submission, but we're going to pass. Please note that we expect contributors to take ownership of and responsibility for the content of their articles; thus, your upfront disclaimer alleviating you from any responsibility for factual errors doesn't work for us. In addition… the lack of history on the Simeon Research firm as a legitimate operation gives us pause, particularly the newly created and single-purpose website.” Despite such apparent issues with the original materials, at least one internet site, ValueWalk, did link to the material, and because of this, a number of people may have become aware of it. We have appealed to ValueWalk to raise its editorial standards in the future.
During prosecution of the case, Organovo gathered information to demonstrate that the two reports issued contained defamatory information, including specific damaging false statements and specific damaging misleading statements. Organovo believes that the outcome of the case demonstrates conclusively that the information circulated by Simeon Research was entirely unreliable.
