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Yes in the totality of circumstances you may be right. It’s only one tidbit. But imo a significant tidbit bc there isn’t really another reasonable explanation. So i tend to overweight.
Horse I don’t have any experience in this type of litigation but those are worthwhile considerations. Your question raises one for me - I wonder if MMs (esp big ones) deploy different algos for different situations, phases of trading, or the like.
Ideally in NWBO v MMs Plaintiff could identify the “long pre-approval OTC spoof for whipsaw trading” algo (obviously, named something else) which could be contrasted forensically/expertly with the “approval anticipated soon spoof down aggressively for covering short position” algo. Etc.
flip you did not say “statistical” and I appreciate your correction and further discussion - your point is more insightful than I had initially understood.
VI why would they hire a PR firm then within months dismiss them unless bc the firm was no longer needed? Of course a replacement “could have been” hired after study and due diligence (you will agree I am sure that your alternative theory that a new PR firm could have been retained assumes the recently-terminated group was removed for unsatisfactory performance, in which case management would presumably be very careful to avoid a third search - who are all the management staff with free time to be selecting a 3d PR firm?). As with all this breadcrumb following one typically will eliminate the rather more improbable inferences. IMO.
no2 and hoff: agree. No matter the claims or evidence, prediction of litigation outcomes is always going to be uncertain. So a defendant needs to assess likelihood of an ABMD verse outcome, but also magnitude of exposure including foreseeable repercussions (SEC inquiry and reputational harm) as well as distraction from revenue-producing activities.
flip - statistical “unequivocal” evidence is an oxymoron- there is no such thing.
I’m not even sure that statistical evidence, no matter how compelling, is alone sufficient to survive a “summary judgment” motion. I’m sure that point can be determined by legal research and perhaps other posters know the answer, but I’ll look when I have the time. NWBO’s counsel undoubtedly know and have considered the answer.
kabunushi-san: thank you I did not know this abt direct sales and NDAs. IMO makes sense in a takeover but why should a stock issuer be able to favor friends arbitrarily? I understand the supposed retail shareholder “remedy” is to vote against management compensation (on advisory basis only if course) but obviously that’s unhelpful. Not arguing against NWBO management just the concept in general. Best wishes.
CO: there is a reasonably recently-developing line of cases involving the “loss” or destruction of relevant data. In the extreme case, this caselaw holds that a responsible defendant is prevented from offering a defense. Under this law, the plaintiff’s claims (assuming plaintiff presents its “prima facie”case) are granted, and any subsequent litigation involves the amount or measure of damages, only.
So what?
Steady - thanks so much. Bumpy ride till then I expect.
kund: thank you very much. Do you anticipate this event occurring in the morning or afternoon?
Knowledgeable posters: forgive please the newbie question: do we have any indication of an approximate BLA filing date? Thanks in advance!
Hank I have no specific information but I guarantee the fee is contingent. That’s just how it works.
** naked shorts
Hank - will lawsuit address naked shorts? As I posted before plaintiffs lawyers wisely plead their strongest case. Purpose being, stick around as long as possible. So there are of course publicly available records of trades that NWBO says show spoofing. Records that NWBO and their attorneys can access and say they have accessed.
Records of naked shorting are I expect (not surprisingly) NOT available through public means. But non-public information like that if the filed case is framed properly would be discoverable. So you build on that. So, IMO, would be communications
between named defendants (MMs) and potential co-conspirators seeking to benefit from spoofing or other proven illegal trading behaviors. Which could be … “journalists,” publishers, BP who financially support MMs, makes shorter if those can be identified, etc.
PM: “Suppressive fire” was my term but I did not explain myself. Your examples of defending the stock, protecting partners, and keeping the MMs at bay or at least thinking a bit about consequences, are what I meant as purposes of the litigation.
Injunctions, continued.
To the NWBO lawsuit. The “elements” of a claim for injunctive relief (a state law rather than federal law issue) are relatively consistent due to their common origins. Unsurprisingly, those elements seek to identify facts that once known will direct the court toward an “equitable” result. NWBO’s counsel’s view of the facts that support an equitable outcome (the claim “elements”) are set out in the paragraphs you quote.
Those are, (1) harm that cannot adequately be compensated for by monetary damages must be threatened to occur; (2)
The harm is not limited to pecuniary, (3) the “balance of the equities” favors injunctive relief, and (4) equitable relief is in the public interest.
So here you can see the “monarch” hearing the litigants’ entreaties such as, Defendant MM’s actions risk or delay achievement of the public good (an efficacious medical treatment for a tragic and random dreaded disease); MMs if enjoined would at worst lose some profits, and at best would be barred from pursuing illegal trading behaviors, which is balanced against the actual loss of life (balancing the equities), and monetary relief cannot replace lives lost (irreparable harm).
Hope you find this answer helpful and maybe interesting.
Injunctive relief - H2R you ask, essentially, about what the Complaint allegations mean. Let me talk about “legal” damage remedies versus “equitable” (non-monetary) remedies. Historically “legal” monetary damages were awarded by common law enforcement authorities - courts or sheriffs. As common law developed the idea of “precedent” grew - if a result was proper in one circumstance, if the same events repeat the same result should be reached even if different parties, or a different locale, was involved. So, rules developed. The authority of these rule-making officials, however, was limited to the award of money. They were without authority to order a party to do or refrain
from doing some act.
The monarch, however, had absolute power and discretion. The monarch could order and enforce an order through force. The monarch could consider whatever facts s/he felt were important, was not bound by “common” law, and could fashion remedies intended to achieve a “fair” (equitable) result.
From these beginnings we have “courts of law” that apply common law rules, and “courts of equity” that seek to obtain equity. These courts have become “merged” in our judicial system so a single judge serves both roles, but lawyers still refer, for example, to the court “sitting in equity.”
flip if MMs materially change their trading pattern that’s potential evidence that they were acting illegally before. Probably not admissible and would need expert presentation, but one never can know how those things go until they are litigated in the specific case.
VI tx as usual. I do not assume, nor do I see you assuming, that the MIA announcement was not planned to occur after the lawsuit PR. Sorry for double negatives but this is the way to state precisely. Happy weekend.
If anyone wants a “live” view of shorts covering in an unexpected turnaround watch AVXL today. 1.0 mm average trade volume today it was 39 mm by 1:00 pm - reportedly the entire float. Great results reported last night after hours, this morning articles about a mysterious math error that supposedly means that an initially-reported 60% improvement (decrease in decline) “really” shows a 30% deterioration. Right …. Have not been in this space for terribly long but what a stinking cesspool. OK, I’m buying more AVXL. PS nice NWBO day looks like. Maybe ppl thinking some news is on the horizon. (Note I did not use the “s” word!!)
Onco yes I don’t really understand why certain commentary is offered. As to your speculation, entirely possible but with algo trading how could an fair system allow delay? Maybe that question answers itself. In any event there certainly are many here who know in detail how the MM and and order allocation/fulfillment systems work.
mike we just use those words to confuse non-lawyers.
Tx muee - very kind of you
Onco: I have exactly the same question. Perhaps one of our posters with m owl edge of the order entry, prioritization and close mechanics could explain how low offers are not immediately executed. OTOH if this is shown as lawsuit alleges occurred, pretty strong evidence of collusion (no MM bought on artificially low offers) or manipulation of the trading by ?? programming or algos? It shouldn’t happen.
H2R theoretically a court could enjoin spoofing but imo unlikely. I discussed this at length in an earlier post that was taken down for some unknown reason - too informative is my guess. The activity is already illegal so the injunction would be doubtful. Also it’s a bit of a “prior restraint” to borrow a 1st Amendment concept - identical trades can be illegal or permissible depending on context so I don’t believe it would be feasible to make the injunction language sufficiently unambiguous. I join your salutation of good luck!
mike00 yes October 2020 is part of the suit as filed.
PM: interesting question. IMO putting out an attack article behind a paywall is something that would be done on advice of the journalist’s counsel. Conversely it seems highly unlikely that management would be satisfied with this as a compromise. Or, candidly, that the parties you mention would communicate at all other than perhaps (and I have NO specific information to support this) the company sending a journalist or publisher a cease and desist letter putting those potential adversaries on formal notice. That is what I would have done months ago because it would help to establish an element of a potential slander claim, knowledge of falsity. Very high NYT v Sullivan standard of course.
Perk sorry sir/ma’am you are totally wrong. You can ask iwasadiver.
Fellow MI: I don’t think Class C shares make a difference vis-a-vis the lawsuit. The damages ultimately would be the same. This doesn’t mean I know what the C’s were for but since we’re discussing, my two cents is that the Cs were a way to make those shares marketable to friendly investors to keep the lights on without exceeding authorized share limit. FWIW.
Grip thank you. Good evening to you.
Hoff- for the 1934 Act trading (spoofing) claims, for the stock seller-plaintiff, damages are the difference between the “non-manipulated” share price which is a hypothetical to be determined by the finder of fact, and the actual SP obtained on a sale. I would assume the state fraud claim is similar but I do not practice in New York.
H2R sorry I am unsure what you mean by an “injection”? But yes I personally believe the timing of this filing was not random but purposely followed the JA (and presumably more illegal trading activity), and as I answered Kaizenman, hopefully signals material PRs to follow.
GLTAL, patients and families.
Kaizenman your question about what approach CEO Powers might take in a possible settlement is one of psychology not law and therefore out of my area of expertise. Additionally those questions are always dependent on how the litigation is proceeding and, of course, “How much money?”
In general tho, as I said, I believe the company’s primary purpose is to preempt future short attacks and concomitant “journalist” negative opinioning so the market or our partner(s), if any, are allowed a relatively level field. As far as the case being a template for other similar claims, I think the lawfirm probably had options, and if so I would expect selected the trading history with the strongest set of favorable facts and secondarily, relatively significant blackboard-able damages.
If this is an adversary fire suppression tactic, presumably actual positive events the company wishes to protect from those attacks should be in the way. Have a pleasant evening.
hoff there are no punitive damages available for any of the 3 damage count theories plead. Nor are there likely IMO to be theories where such damages or a multiplier would be available.
rizona on reflection I agree contingency fees will almost certainly be greater than the one-third I mentioned and agree with your estimate
Fireman: congrats to us on AVXL. Stat sig. Thx!!
Fireman I cannot assess the opinion about the plaintiff firm nor the percentages, however this is an astute glimpse of the problems and concerns facing the defendants and their counsel. It is my informed opinion also that plaintiff’s counsel’s and NWBO’s plan is to file the very strongest possible claims in order to avoid early dismissal on “summary judgment” and use that position to pursue broad and intense discovery of other possible claims or recovery periods, I assume including consideration of collusion claims against journalists or others.
This I am certain is well known to defendants and their counsel (or I would not post this), and would be a strong reason that early settlement could be considered. Spent $10s of mms on defense and tons of management unproductive time, or direct those assets to settlement and go back to making money elsewhere a bit wiser…
Damages, continued
I am a defense lawyer by trade. I will tell you that I feel tremendous pressure to defend suits where a material loss is possible. Especially as I note anecdotally where, as is the situation here, an aggressive defense can result in a jury that actively disapproves of your client, and maybe, you. Contrary to the position of plaintiff’s counsel who risk their time only, defense counsel risks (depending on the client and claim) substantial assets of the client and likely here, the reputation of the client and to some extent, the defending lawfirm. And there is no real “upside” for
a defendant there is only the avoidance of a bad, or maybe really bad, outcome.
I do not agree with some who have suggested that plaintiff’s counsel would not have taken the case without a high level of confidence in a favorable outcome. To the contrary, this is a pretty unique case to my knowledge. However, given what (little) I know here, I would far prefer to be plaintiff’s counsel if I could afford to take that risk.
Grip thank you. I read a lot of excellent dd here I am happy to contribute within my limited expertise.
There are two different entities on the Plaintiff side with non-conflicting yet very different interests. Honestly for NWBO I see the lawsuit as suppression fire. Let’s assume it can be proven that shares sold for an average of say $.70 could have been sold for $2.70 (a difficult proposition to establish imo). 50 mm shares x $2.00=$100mm. A significant amount if SP remains around $.70 but not worth the time imo if SP goes to say $5.00. (Assume 1.5b shares @ $5.00 is $7.5b is 1.3%). I will be wrong here since it’s a guess but not by an order of magnitude.
For a plaintiff lawfirm to recover $100mm on a presumably 1/3 contingent fee = $33mm shared primarily by the handful of lawyers who work the file - a nice return. And no one should underestimate the tenacious diligence of competent plaintiffs counsel - they will leave no stone unturned I guarantee that completely. Plus they’d have a model to sell to other OTCs and similarly-situated.
Further counsel can run the case pretty independently for the most part. They are working without fees charged to NWBO; they understand and take the risk, they are exceptional at that
CONTINUED…