(PRWEB) 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 AkersÂ stock that AllianceÂs client received from Akers. As part of its due diligence to ensure the negotiability and tradability of AkersÂ stock, Alliance obtained oral and written assurances from Paul Freedman, AkersÂ Chief Financial Officer, and from Raymond F. Akers, Jr., AkersÂ 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. AkersÂ 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 AkersÂ 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 AllianceÂs President, Julian Brown: ÂIt 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 ExchangeÂs regulatory body to take some action against Akers. For the viability of the exchange, this cannot and should not be allowed to happen again.Â
The case number for this lawsuit is 04-60453-CIV-COHN.
Alliance Investment Management, Ltd. Tel: (242) 326-7333. Fax: (242) 326-7336. Info: http://www.allianceinvest.com
Law Offices of Troy D. Ferguson, P.A., AllianceÂs Florida Trial Counsel. Tel: (305) 858-0888. Fax: (305) 858-7107. E-mail: firstname.lastname@example.org
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