latest-news-headlines Market Intelligence /marketintelligence/en/news-insights/latest-news-headlines/d-o-litigation-digest-inovio-executives-directors-sued-over-covid-19-vaccine-59506684 content esgSubNav
In This List

D&O litigation digest: Inovio executives, directors sued over COVID-19 vaccine

Blog

Automating Credit Risk Surveillance Using Statistical Models

Case Study

Searching for Alpha with Textual Data

Video

S&P Capital IQ Pro | Powered by Expert Insights

Blog

Customer Success: a $200 million market poised for dramatic growth


D&O litigation digest: Inovio executives, directors sued over COVID-19 vaccine

The number of securities-related lawsuits filed in the U.S. has been rising rapidly in recent years, particularly after M&A transactions and other significant corporate developments are announced.

S&P Global Market Intelligence is now keeping track of such cases filed against companies in our covered industries. The following information is compiled on a best-efforts basis twice monthly.

Application software

Ideanomics Inc. and certain of its executives and directors are facing a class action lawsuit alleging violations of the federal securities laws related to the company's purported 1 million-square-foot electric vehicle expo center in Qingdao, China.

The defendants allegedly failed to disclose material facts about the purported center and the company's misrepresentation of the performance of its electric vehicle business in China. Hindenburg Research revealed in June that Ideanomics had used doctored photos in its press releases for the purported center, which an investigator it hired was unable to find any trace of in Qingdao.

Asset management

United States Oil Fund LP, its sponsor United States Commodity Funds LLC and some of the sponsor's executives are facing a class action lawsuit over allegations that they failed to disclose the impacts and risks faced by the exchange-traded fund resulting from the extraordinary market conditions amid the coronavirus pandemic and the oil price war between Saudi Arabia and Russia.

The defendants allegedly conducted a "massive offering" of United States Oil Fund's shares, which exacerbated the undisclosed risks and caused the fund billions of dollars in losses.

The lawsuit also named the underwriters of United States Oil Fund's share offering as defendants, which consisted of ABN AMRO Bank NV, BNP Paribas Securities Corp., Citadel Securities LLC, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities Inc., Merrill Lynch Professional Clearing Corp., Morgan Stanley & Co. Inc., Nomura Securities International Inc., RBC Capital Markets LLC, SG Americas Securities LLC, UBS Securities LLC and Virtu Financial BD LLC.

Auto parts and equipment

China XD Plastics Co. Ltd. and certain of its executives and directors are facing a class action lawsuit alleging violations of the Securities Exchange Act related to the company's proposed merger with Faith Dawn Ltd. and Faith Horizon Inc.

The defendants allegedly failed to disclose material information regarding the background process leading up to the proposed transaction, including the amount of compensation for the financial adviser of the special committee of the board of China XD Plastics and the "market check exercise" performed by the financial adviser related to the merger agreement.

Bank

Deutsche Bank AG and certain of its executives are facing a lawsuit over allegations that it made false and misleading statements before it agreed to pay a $150 million penalty for compliance failures related to convicted sex offender Jeffrey Epstein.

Biotechnology

Endonovo Therapeutics Inc. and CEO Alan Collier are facing a lawsuit alleging violations of the securities laws related to the company's securities purchase agreement and associated convertible promissory note with Auctus Fund LLC.

As of July 8, the company allegedly owes Auctus Fund $503,595.40 plus accrued interest after it breached and defaulted on the securities purchase agreement and convertible promissory note. Auctus Fund previously settled a dispute with the company in June 2016 after Endonovo defaulted on a different securities purchase agreement and convertible promissory note.

_________________________________

Inovio Pharmaceuticals Inc., as nominal defendant, and certain of its executives and directors are facing a verified shareholder derivative complaint alleging that they took advantage of the market demand for a COVID-19 vaccine, which inflated the company's stock price.

The defendants allegedly misrepresented during a broadcasted meeting at the White House that it had already developed a COVID-19 vaccine, which would purportedly be ready for human trials as early as April 2020, despite only having an early-stage prototype for a vaccine.

Data processing and outsourced services

Exela Technologies Inc. and certain of its executives and directors are facing a verified shareholder derivative complaint alleging that they fraudulently misrepresented the extent of the inaccuracies that plagued the company's reported financial data.

The defendants allegedly repeatedly misreported several of the company's total revenue, net loss and other vital financial metrics. Exela Technologies announced in March that it would be unable to timely file its annual report for 2019, and revealed millions of dollars in adjustments to its revenue, operating loss, net loss and other important metrics in June through its restated financial statements.

Fertilizers and agricultural chemicals

AgroFresh Solutions Inc. and its board of directors are facing a class action lawsuit alleging violations of the Securities Exchange Act related to the company's $150 million preferred stock purchase agreement with PSP AGFS Holdings LP, an affiliate of Paine Schwartz Partners LLC.

The defendants allegedly failed to disclose material information regarding the amount of compensation for AgroFresh's financial adviser in connection with the proposed securities purchase agreement and potential conflicts of interest involving the financial adviser.

Internet software and services

J2 Global Inc. and certain of its former and current executives are facing a class action lawsuit over allegations related to the company's "decades-long history" of engaging in questionable undisclosed related-party transactions and self-dealing.

The company also allegedly used misleading accounting methods to hide the underperformance and impending impairments related to its acquisitions, including an undisclosed €22 million impairment recorded by a subsidiary of J2 Global.

Investment banks, brokers and capital markets

TD Ameritrade Inc. and TD Ameritrade Futures and Forex LLC, which does business as thinkorswim Group Inc., are facing a class action lawsuit over allegations that they mishandled and liquidated investors' futures and options investments in a "commercially unconscionable" manner.

The companies also allegedly failed to disclose to the investors that the price of their futures contracts could fall to zero, and failed to provide a way to edit, roll, modify or offset the investors' long positions.

Oil and gas storage and transportation

Buckeye Partners LP and its board of directors are facing a class action lawsuit alleging violations of the federal securities laws related to the company's proposed acquisition by IFM Investors Pty Ltd. through IFM Global Infrastructure Fund, Hercules Intermediate Holdings and Hercules Merger Sub LLC.

The defendants allegedly failed to disclose material information related to the financial valuation analyses performed by the company's financial adviser and potential conflicts of interest involving company insiders and the company's additional financial adviser.

Payment processors

Wirecard AG, some of its executives and directors, and its external auditor, Ernst & Young GmbH, are facing a class action lawsuit alleging violations related to Wirecard's overstated cash balances and the missing €1.9 billion cash on its trust account.

The defendants allegedly failed to disclose material information about the company's overstated financial results, its inadequate risk management system related to financial accounting and the failure of Ernst & Young to audit the company under applicable auditing principles.

Personal and beauty products: Producers

NuGene International Inc. is facing a lawsuit alleging violations of the Securities Exchange Act related to its securities purchase agreement and associated convertible promissory note with Auctus Fund LLC.

As of July 14, the company allegedly owes Auctus Fund $769,298.97 plus accrued interest after it breached and defaulted on the securities purchase agreement and convertible promissory note.

Pharmaceuticals

Bayer AG and certain of its executives are facing a class action lawsuit alleging violations of the federal securities laws related to Monsanto Co.'s flagship glyphosate-based weed killer product Roundup. Bayer made an unsolicited all-cash offer to acquire Monsanto in May 2016 and completed the acquisition in June 2018.

The International Agency for Research on Cancer classified glyphosate as a probable carcinogen in 2016, which resulted in numerous lawsuits from cancer-stricken plaintiffs who alleged that their cancer was caused by their exposure to Monsanto's Roundup product.

_________________________________

MJ Biotech Inc. is facing a lawsuit alleging violations of the Securities Exchange Act related to its securities purchase agreements and associated convertible promissory notes with Auctus Fund LLC.

As of April 29, the company allegedly owes Auctus Fund $432,167.61 plus accrued interest after it breached and defaulted on the securities purchase agreements and convertible promissory notes.

_________________________________

Verrica Pharmaceuticals Inc. and certain of its executives are facing a class action lawsuit alleging violations of the federal securities laws related to its VP-102 drug-device topical cantharidin solution, which the company is developing as a treatment for molluscum contagiosum and common warts.

The defendants allegedly failed to disclose material information about the safety risks posed by the proprietary applicator for VP-102 and the resulting need for the company to incorporate certain risk-mitigation user features that would require additional testing, which would likely delay regulatory approval for VP-102.

Renewable electricity

TerraForm Power Inc. and its board of directors are facing a class action lawsuit alleging violations of the Securities Exchange Act related to TerraForm Power and TerraForm Power NY Holdings Inc.'s proposed transaction with Brookfield Renewable Partners LP, Brookfield Renewable Corporation Inc. and 2252876 Alberta ULC.

The defendants allegedly failed to disclose material information related to the analyses performed by the company's financial advisers, potential conflicts of interest involving one of its financial advisers and the financial projections of TerraForm Power and Brookfield Renewable Partners.