IRONRIDGE

[factcheck14]

Investment Firm Fends Off 'Bid-Whacking' Claims

A federal judge in Los Angeles threw out a "bid whacking" suit against investment firm Ironridge Global Partners on Tuesday, ruling there's no evidence the firm intentionally drove down the stock value of one of its investment companies.

http://www.therecorder.com/id=1202734622100/Investment-Firm-Fends-Off-BidWhacking-Claims?slreturn=20150714090240

Scrips claimed Ironridge engaged in "bid whacking," or selling shares at the bid price instead of demanding more money—a tactic that can lower future bids. That's a new issue for the courts, as there are no reported decisions discussing bid whacking and whether it is manipulative. Morrow wrote she will "assume, without deciding, that bid whacking could constitute manipulative conduct." But the court found Ironridge actually sold its Scrips shares at prices that were within an average range.

Scrips also tried to show Ironridge's leaders acted with an intent to defraud by arguing the investment firm has a pattern of destroying companies' stock values, citing a post by watchdog website "Scam Informer." But Morrow wrote Scrips didn't show those online posters were reliable.