GameStop’s Ryan Cohen has now been dragged in a lawsuit for insider trading, and allegedly profiting tens of millions of dollars illegally.
The company formerly known as Bed Bath & Beyond Inc. has sued Ryan Cohen and his company RC Ventures LLC, alleging that they engaged in insider trading and made $47 million in illegal profits.
Cohen is the founder of Chewy Inc. and the chairman and CEO of GameStop Corp. Between January and August 2022, while Cohen and RC Ventures were acting as statutory directors of Bed Bath & Beyond, they allegedly used insider information to make profitable trades in Bed Bath & Beyond’s stock.
The bankrupt Bed Bath & Beyond company claims it is entitled to recover these “short-swing” trading profits under securities law, since Cohen and RC Ventures were acting as directors and also beneficially owned more than 10% of Bed Bath & Beyond’s stock, per Bloomberg.
This lawsuit is part of the company’s broader efforts to recover funds for its creditors as it goes through bankruptcy proceedings.
The company has also sued a New Jersey agency to recover $19 million in tax credits, and is seeking to recover over $300 million in trading profits from another hedge fund involved in a failed financing plan.
RC Ventures is currently the largest shareholder of GameStop, owning an 8.7% stake as of June 2023.
James A. Hunter of Radnor, Pa., represents the plaintiff.
The case is 20230930-DK-BUTTERFLY-I Inc. v. Cohen, S.D.N.Y., No. 1:24-cv-05874, complaint filed 8/1/24.
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Also Read: SEC Now Charges CEO For Whopping $170 Million Fraud Scheme
Other Stock Market News Today
Meta Materials now files an unexpected bankruptcy following a slew of technical difficulties with its website and communications systems.
In an SEC filing, the company reports that it has commenced bankruptcy proceedings by filing an assignment in bankruptcy under section 49 of the Bankruptcy and Insolvency Act (Canada) in the District Court of Ontario.
“Grant Thornton Limited was appointed as trustee in the bankruptcy for the benefit of the creditors of MTCI.
The trustee will wind down the business of MTCI and make distributions, if any, to its creditors in accordance with the applicable provisions of the Bankruptcy and Insolvency Act (Canada),” the filing read.
On July 25, Meta Materials’ website, alongside its email system and other communications were taken offline.
The website was then re-activated and email systems restored on July 29, 2024.
The company stated that it proceed with its bankruptcy filing on July 26, the time in between when all of its systems were temporarily offline.
Investors are now questioning the integrity of the company after being left in the dark in regards to the MMTLP event.
“Everyone weaseling their way around taking accountability for stealing our money.
I wouldn’t be surprised If NBH did the same thing. Just slowly pulling away with loop holes,” says one user (@U3HaltCorrupt) on X.
“So…what do we do? Never been in this situation before having shares in a company who files for bankruptcy,” says another investor.
Last year, the SEC provided John Brda and former Meta Materials CEO George Palikaras with “Wells Notices” relating to a previously disclosed SEC investigation into, among other things, the merger involving Torchlight Energy Resources, Inc. and Metamaterial Inc.
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Also Read: Foreign Markets Are Now Imposing Bans For Illegal Trading
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