According to this article on PR Newswire, Relmada Theraputics has sued Laidlaw & Company for actions it took while acting as Relmada’s investment banker.
One of the accusations concerns Laidlaw sending out false and misleading proxy materials about Relmada in December 2015. However, the article fails to explain this, so I am forced to do my best to read between the lines.
The U.S. District Court for the District of Nevada issued a temporary restraining order and injunction against Laidlaw and its principals. Those are its Chief Executive Officer, Matthew D. Eitner and its Manager Partner James P. Ahern as a result of the proxy materials they sent out.
Apparently, Relmada had to spend money responding to whatever allegations Laidlaw, Ahern and Eitner made against the company, and now they are suing for financial compensation. And they wish the court to prevent Laidlaw from damaging Relmada in the future.
Laidlaw did serve as Relmada’s investment banker when it sold stock offerings in December 2011 and May 2014. In early 2015 Relmada engaged Laidlaw to put on a road show to attract more institutional investors, but Relmada was unhappy with the results. At a December 1 meeting, Laidlaw demanded the right to appoint a majority of the board of directors. On December 4 Laidlaw put out a press release announcing it was attempting to elect five directors to take control of the company. Relmada’s management had to spend money to respond, and Laidlaw’s attempt failed.
All I can say is that when a company hires an investment banker to raise funds, they should not have to be afraid of the banking firm trying to take over the company. How often has that ever happened? What laws apply here? Where is the SEC?
Laidlaw & Company is an investment banking and wealth management firm based in the United Kingdom, which operates in both the UK and the US.