SAN FRANCISCO, Aug. 31, 2015 /PRNewswire/ -- On
August 5, 2015, the U.S. District
Court for the District of Oregon
denied motions to dismiss securities class action claims against
Galena Biopharma, Inc. (NASDAQ: GALE) and certain of its directors.
The class actions allege that the individual defendants had
facilitated a "pump and dump" scheme to artificially inflate
Galena's stock price, and during an eighteen day trading period
while the stock price was inflated, sold massive amounts of their
personally-held shares.
Specifically, the class actions allege that in July 2013, the individual defendants hired stock
promotion firms, the DreamTeam Group and Lidingo Holdings, LLC to
initiate a misleading marketing campaign to artificially boost
Galena's stock price. The two firms then published a series of
"articles," which promoted Galena's stock on investor websites
under multiple aliases. These "articles" never disclosed that
Galena (under the individual defendants' direction) paid for the
authors to write the articles or had approved every article before
its publication.
When news of the scheme began to leak out, Galena's share price
plummeted and the SEC announced that it was investigating Galena's
relationship with the DreamTeam.
In upholding claims against certain of Galena's directors, the
Court found that the amount and timing of these defendants' stock
sales were dramatically out-of-line with their prior trading
practices and weighed heavily in support of an inference of
fraudulent intent.
Shareholder rights law firm Schubert Jonckheer & Kolbe LLP
is investigating whether derivative claims on behalf of Galena may
be warranted. Through a derivative action, Galena may seek to be
repaid for its losses due to having to defend the class actions and
pay any damages assessed, as well as for its costs incurred in
responding to the SEC's investigation.
If you are a long-term holder of Galena Biopharma stock and wish
to obtain additional information about your legal rights, please
contact Miranda Kolbe either via
email at mkolbe@schubertlawfirm.com, by telephone at (415)
788-4220, or fill out the form on our website
at http://classactionlawyers.com/galena.
About Schubert Jonckheer & Kolbe
The Schubert firm has extensive experience in prosecuting
securities claims, representing investors throughout the nation in
shareholder lawsuits. Attorney advertising. Prior results do not
guarantee similar outcomes.
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SOURCE Schubert Jonckheer & Kolbe LLP