Decision Diagnostics Corp (DECN)

[Leirum]

2 Items - Causa AHN (Access Health Net) and Options compensation.

Clarification for the avoidance of doubt and in the hope, that this ever construed and repeated story around the Chapter 7 of AHN in 1996/97 will find its end.

Proper Due-Diligence would demand the full study of all court documents available and they are available, however just with posting a link that presents the start and the Settlement, but not the breakdown of the judgement, the story of course Is not and cannot be complete because it would show, that K.B. was not found guilty and more there is no documents that shows, that K.B. had to pay anything, but to come up for his legal fees. One should know the difference between accusation and judgment. If of course somebody Ends the story with the chapter accusation then the field is open for stories but if one takes the time and reads then as well the judgment (what proper Due-Diligence actually would demand) then the “possible story” becomes a “Non-Story.”

And what is more important, there is no document and evidence that the SEC got involved. So the question would then be: How bad could it really have been?

The same pattern we see with the Chapter 11 and Chapter 7 cases in the Airline Industry and Automobile Industry, the SEC never got involved. Why should they?

Here a summary of the case from 1997.
Behind the class action was Willy Lerach, famous lawyer for such kind of acts, but later on he had to go to jail by himself. But he is and was not the only “moralist” to crusaded against companies but at the end got caught because of not being able to distinguish between what is mine and what is hers.

When the class action suit was over, 3 were found guilty and forced to pay.

-The Hedge Fund major shareholder who was guilty of stock manipulation, pumping on the way up, bashing and shorting on the way down, while running AHN as Chairman and CEO, actually forcing out the founders, the officers and directors, by naming his own directors.

- the auditing firm where in the middle of an annual audit, the auditing partner left his firm in return for a $500,000 bonus and joined AHN as their Executive VP and CFO. The auditing firm's insurer paid their judgment, the largest payment in the case, and the newly minted Executive VP and CFO lost his CPA license when his junior partner at the CPA firm became whistle blower.

- The only person who went to jail was an investment manager from Beverly Hills, CA who raised money for AHN under the formula of one for me and one for them, two for me and one for them. He copped a plea and spent 4 years in Jail

Conclusion:

I can find nowhere in all documents that Mr. Berman was held accountable for anything and that he had to pay anything into the settlement amount. Everyody would know I guess, the differene between accusation and judgement. Everybody can sue anybody any day but then the buck stops here. All what he had to pay for where his personal legal fees, this is all. The reason is clear as well when studying the court paper: At the time when the mess took place that was later on responsible for the class-action suit by the shareholders, K.B. was not in charge. All documented and very well documented in those court papers.


SUBJECT OPTIONS.

Another Story always good to debate is Stock Options. If understood then actually it should be a non-event, however if not understood then it becomes complicated for those. There is no NYSE company listed where we cannot see issued or granted options for employees (bonus related) or management or board.
Actually a chart shows, that options from a balance-sheet point of view are the cheapest form. The most expensive one is the cash-compensation – as money flows out of the account – or then outright stock-compensation. At the low end of the chart we have the options-compensation. Those familiar with the revisions from GAAP versus pro forma earnings will know what I am talking about.