Investigating Potential Claims Involving PixarBio Corp.
Did your financial advisor recommend an investment in PixarBio Corp.? If you suffered losses investing in PixarBio Corp., the securities attorneys at The White Law group may be able to help you recover your losses through FINRA Arbitration.
According to a press announcement yesterday, the Securities and Exchange Commission has charged PixarBio Corporation, its CEO, and another employee with “lying about their progress in seeking FDA approval for a non-opiate pain treatment and with lying about the company’s finances.”
PixarBio Corporation is a biotech start-up formerly based in Massachusetts. The company specializes in pharmaceutical/biotechnology focused on pre-clinical and commercial development of novel neurological drug delivery systems for post-operative pain.
The SEC alleges that the insiders along with the CEO’s close friend manipulated the company’s publicly trading stock, and the CEO and his friend kept about $400,000 for themselves.
Pixar Bio Corporation, its founder and CEO Frank Reynolds, and employee Kenneth Stromsland allegedly misled investors with false claims about PixarBio’s progress in developing “NeuroRelease,” a purported method of delivering non-opiate, post-operative pain medication.
As alleged in the SEC’s complaint, from December 2015 to the present, the defendants purportedly told investors that the FDA had lowered PixarBio’s hurdles for regulatory approval.
They are also charged with allegedly misleading investors about the amount of money PixarBio had raised and about a phony takeover bid of a company that Reynolds had previously led. According to the complaint, the defendants raised about $12.7 million from about 211 investors in an unregistered offering.
The SEC’s complaint also alleges that from about July 2016 to January 2017, Reynolds, his close friend M. Jay Herod, and Stromsland engaged in a fraudulent scheme to acquire and merge PixarBio with a publicly traded company and to secretly manipulate the sales of shares in the new entity.
Reynolds and Herod allegedly pocketed about $400,000 from the sales and then used an additional $500,000 to keep PixarBio afloat as Reynolds allegedly misled investors about how much money they had raised in the unregistered offering.
The defendants are also charged with violating the registration requirements for securities offerings, while Reynolds and Stromsland are charged with selling securities without being registered as a broker or dealer.
Recovery of Investment Losses
The White Law Group is investigating potential claims involving broker dealers who may have improperly recommended PixarBio Corp. to investors.
Broker dealers are required to perform adequate due diligence on all investment recommendations they make. They must ensure that each investment is suitable for the investor in light of the investor’s age, risk tolerance, net worth, financial needs, and investment experience.
If a broker or brokerage firm makes an unsuitable investment recommendation or fails to adequately disclose the risks associated with an investment they may be liable for investment losses through FINRA arbitration.
FINRA operates the largest securities dispute resolution forum in the United States, and has extensive experience in providing a fair, efficient and effective venue to handle a securities-related dispute.
If you have suffered investment losses in a PixarBio Corp., the securities attorneys at The White Law Group may be able to help you. Please contact The White Law Group at 1-888-637-5510 for a free consultation.
The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida. For more information on the firm, visit www.WhiteSecuritiesLaw.com.