Recently, Relmada Therapeutics filed a motion to amend the initial complain against its former investment banking associate, Laidlaw & Company (UK) Ltd. The request for amendment is particularly notable because Relmada Therapeutics has already filed a case against Laidlaw and its Principals, Matthew Eitner and James Ahern. The initial claim suggests that Laidlaw’s actions negatively impacted the company as it was involved in disclosing confidential matters to the public. However, the new claim includes an additional legal claim based on Laidlaw’s breach of the fiduciary duty that it owed to Relmada.
Actually, Laidlaw & Company (UK) Ltd acted as the primary investor banker for the company in important dealings in 2011 and 2014. It was also the financial advisor to Relmada when Relmada merged with Camp Nine Inc. Resulting in becoming a public company. In the Spring of 2015, the company discussed the option of attracting new investors. Therefore, the management of Relmada initiated very confidential meetings with the top executives of Laidlaw & Company regarding potential investors and other future prospects. However, Relmada Therapeutics was dissatisfied over the negotiations and performance of Laidlaw & Company regarding its handling of the affair.
Responding to the dissatisfaction shown by the management of Relmada, Laidlaw & Company (UK) Ltd filed a Schedule 13D with the Securities and Exchange Commission. As a result of the filing, important and confidential information about Relmada was revealed to the public. The information also leaked important fund raising efforts by Relmada. Due to the disclosure, the stock market price of the company declined from $4.03 per share to to its current price of $1.65 per share. Relmada believes that there the leak of important information had led to the decline despite very positive development news from the company.
It is also notable that this is not the first time that Laidlaw & Associates has acted against the ethical norms. In the past, Laidlaw has acted irresponsibly by failing to establish and implement adequate FINRA policies. Between 2007 and 2009, FINRA received almost 60 customer complaints against the company. Likewise, its managing partner, James Ahern, continues to lie about his education. In fact, there are several tax liens filed against him in the New York State.