A United States District Court Judge sitting in Ft. Lauderdale, Florida has granted a motion filed by Alliance Investment Management Ltd. to assert a fraudulent misrepresentation claim against Akers Biosciences, Inc. for making misrepresentations about the negotiability of 2.8 million shares of its common stock and for wrongfully canceling those shares after Alliance traded those shares on the London Stock Exchange.
(PRWEB via PR Web Direct) July 6,
2005 -- A United States District Court Judge sitting in Ft. Lauderdale, Florida
has granted a motion filed by Alliance Investment Management Ltd. to assert a
fraudulent misrepresentation claim against Akers Biosciences, Inc. for making
misrepresentations about the negotiability of 2.8 million shares of its common
stock and for wrongfully canceling those shares after Alliance traded those
shares on the London Stock Exchange. Alliance is an investment brokerage firm
and a Class 1 broker/dealer based in Nassau, Bahamas. Alliance provides a
variety of financial products and services, including equities, fixed-income
securities, options, mutual funds, futures trading, investment capital and
estate planning. New Jersey-based Akers Biosciences manufactures and distributes
rapid diagnostic testing products throughout the United States and Europe, and
its shares of common stock are traded on the Alternative Investment Market of
the London Stock Exchange.
Alliance received instructions from one its clients to sell 2.8 million shares of Akers’ stock that Alliance’s client received from Akers. As part of its due diligence to ensure the negotiability and tradability of Akers’ stock, Alliance obtained oral and written assurances from Paul Freedman, Akers’ Chief Financial Officer, and from Raymond F. Akers, Jr., Akers’ President and Chief Executive Officer, that the 2.8 million shares of Akers stock bore no restrictions and were negotiable and freely tradable. After openly trading the bulk of the stock on the London Stock Exchange, Alliance was dismayed to discover that the Akers shares were restricted and constituted collateral for a loan that Akers obtained to fund its operations. Akers’ executives also made similar misrepresentations regarding the negotiability of its stock to RBC Dominion Securities (Global) Limited, a securities brokerage firm that sold 230,000 shares of Akers stock.
Once Akers obtained the final installment of its loan proceeds, Akers cancelled 2,765,000 shares of its stock that Alliance and RBC sold in the market, leaving bona fide purchasers of that stock with worthless securities and traders of that stock exposed to adverse claims. Prior to its wrongful stock cancellation, Akers was aware of the sales of its stock but remained silent and continued to represent to Alliance and RBC that the 2.8 million shares were freely tradable. RBC sustained damages in excess of $270,000.00 as a result of Akers’ wrongful stock cancellation. In its federal lawsuit against Akers, Alliance seeks damages in excess of $1.5 million. It is not clear whether RBC will seek to join this lawsuit or sue Akers separately. Presently, no class or shareholder derivative claims have been filed against Akers.
The jury trial is scheduled to commence the two-week period beginning August 15, 2005. According to Alliance’s President, Julian Brown: “It is shocking to me that a company would unilaterally cancel shares of stock that its top executives represented to be fully negotiable, especially where Akers has operated at a loss ever since its existence and relies so heavily on its stock to borrow and raise funds for its operations. We hope to convince the Court not only to compensate Alliance for its actual monetary losses caused by Akers but also to assess punitive damages against Akers given the blatant and reckless disregard shown by its officers. Sadly, this misconduct sends a chilling message to stock traders and purchasers alike, and I expect the London Stock Exchange’s regulatory body to take some action against Akers. For the viability of the exchange, this cannot and should not be allowed to happen again.”
The case number for this lawsuit is 04-60453-CIV-COHN.
Alliance Investment Management, Ltd. Tel: (242) 326-7333. Fax: (242) 326-7336. Info: www.allianceinvest.com
Law Offices of Troy D. Ferguson, P.A., Alliance’s Florida Trial Counsel. Tel: (305) 858-0888. Fax: (305) 858-7107. E-mail: e-mail protected from spam bots
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Source : http://www.prweb.com/releases/2005/7/prweb258868.htm