HLNT/NIR/Ribotsky/Humphries/Walters/PWC Lawsuits Update 06/01/2012:
These decisions were what I expected yesterday, should have waited one more day to post my analysis. Judge Kornreich dismissed the Orders to Show Cause with a nonchalant air, saying that they had been resolved in the Status Conference hearing. The Judge is trying to keep a lid on the case so that it doesn't become explosive, even though in her own words she stated in October of 2011 that fraud permeated the whole case. It is clear that the Judge considers HLNT, Walters and Humphries to be playground kids involved in a childish spat that she is resolving. However, she has been forced to set down the law, literally, for Humphries and Walters, so that they will stop playing their games.
The biggest question to be answered is how this affects NIR/PWC and what it means for HLNT. Had HLNT not agressively fought this fraud in court, it would have wound up like a company that PWC is currently testing the waters with, EPGL. Current management would have been changed, a new product would have been brought into the deal, the Stock would have been R/Sed, with NIR diluting the post R/S so heavily that HLNT (or its predecessor) would have been killed in the 'cellar' of .0001 trading (as had been predicted, but wrongly, by other posters on this board). As far as the legal fees paid so far by HLNT, they have been worth it from the appearances of where HLNT is about to go business wise (which would not have been the case if the company and current management not believed in the value of HLNT and worked so hard to bring it to success).
Fighting the Fraud caused NIR and Ribotsky additional problems that Ribotsky never anticipated. That one of his funded companies would stand up for itself and catch him in the process of wrongdoing.
PWC has practically admitted that Ribotsky has committed the wrong doing by attempting to continue to use the legal maneuver of 'In Pari Dilecto', as seen by their appeal on that issue. Their intent is to argue at trial (which they will regardless of what the Judge has decided) that all the parties were involved in something and (as PWC's NIR's attorneys) will dance around the issue of the fraud, but will argue that the transfers of the notes were valid because NIR's Funds are 'innocent' of the wrong doing. However, at trial, it will be learned that even the 'innocent' NIR Funds cannot benefit from the fraud that was perpetrated on HLNT shareholders and HLNT itself (successor to SSEV) by the prior management of HLNT (as SSEV), especially since Ribotsky was a party to the fraud.
The case should go to trial by late summer at this point, 'should' being the operative word and dependant on Humphries and Walters testing the Judge's resolve in the matter of their Depositions, and other issues still to arise along the way. But the good thing is that investors are beginning to see that the case in the future will become more of an annoyance and will end up being a non issue as HLNT continues to grow. The higher the PPS of HLNT, the less of an impact any adverse resolution to the NIR case will be to HLNT. At a PPS of $.15 or higher, a loss of the suit, even at the worse case, becomes trivial. Right now, time is on the side of HLNT, and although this also means more attorneys fees, this will be looked back on as having been a necessity and endurable as a part of HLNT's success.
Will the case be settled? Only when PWC realizes that they can't even get a nuisance settlement from HLNT.
Will Walters, Humphries and Ribotsky be tried for Fraud? That is in the hands of the Feds, who have other irons in the fire, so to speak, with Ribotsky and Magnetar. Anything that helps the Feds put more pressure on Ribotsky to get him to testify against Magnetar and it managers will be used by the Feds to up their leverage over Ribotsky.
The opinions expressed herein are my own and investors should conduct their own due diligence and make their own investments decisions accordingly.
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