Cassava Sciences Files Lawsuit Against Perpetrators of “Short and Distort” Campaign
November 03 2022 - 9:15AM
Cassava Sciences, Inc. (Nasdaq: SAVA), a clinical-stage
biotechnology company, today announced that it has filed a lawsuit
in federal court against certain individuals who executed a “short
and distort” campaign against the Company. The 150+ page complaint
alleges that the Defendants’ disinformation campaign caused a
precipitous decline in Cassava Sciences’ stock price, a
multi-billion dollar decline in its market capitalization, and
delayed the Company’s work in developing a treatment for
Alzheimer’s disease.
The lawsuit alleges: “Defendants placed personal
enrichment over science, over the health of patients, and over the
truth. Defendants saw an opportunity to manipulate a stock price
and financially benefit from their ‘short positions’ by defaming a
company developing a drug for people with Alzheimer’s disease, a
condition that afflicts millions of people. Defendants seized that
opportunity and, while enriching themselves, caused irreparable
harm to the company, its attempts to find a treatment for the
disease, and patients waiting for that treatment. Defendants’
conduct is beyond shameful. It is unlawful.”
The complaint identifies over 1,000 false and
defamatory statements made by the Defendants in submissions to the
U.S. Food and Drug Administration as well as “reports” and
presentations that Defendants published online or on social media.
According to the complaint, “Defendants saturated the market,
investors, federal agencies, testing sites, and others with their
false and defamatory message about Cassava. Defendants did not have
any real or valid concerns with Cassava, its foundational science,
or its tests. Defendants engaged in their saturation campaign to
profit based on a decline in Cassava’s stock price.”
Cassava Sciences has retained J. Erik Connolly,
Managing Chair of the Litigation Group at Benesch Friedlander
Coplan & Aronoff LLP to represent it in this matter. Mr.
Connolly has litigated some of the largest defamation claims in the
country, including a $6 billion dollar claim against ABC and
multi-billion-dollar claims brought on behalf of a voting
technology company against Fox News and others based on their
statements following the 2020 U.S. election.
“There are serious consequences when people use
disinformation as a way to deflate a company’s stock price and make
money by shorting the stock,” said Mr. Connolly. “These actions not
only financially hurt the Company and its investors, but they also
cast a permanent cloud over research being done to try to find a
treatment for a terrible disease. That is just wrong.”
“We are still investigating whether additional
individuals or entities should be brought into this case or have
separate claims brought against them,” according to Mr. Connolly.
The filing of this lawsuit marks another step in Cassava Sciences’
vigorous defense of itself and its stakeholders. It follows Cassava
Sciences’ press releases denying the disinformation being
disseminated by Defendants, including: No Evidence of Data
Manipulation in Science Publication on Simufilam (August 18, 2022),
FDA Denies Citizen Petition Filed on Behalf of Short Selling
Clients (February 10, 2022), Science Journal Finds No Evidence to
Support Claims of Data Manipulation in 2005 Publication (December
21, 2021), Review by Journal of Neuroscience Shows No Evidence of
Data Manipulation in Technical Paper Foundational to Cassava
Sciences’ Lead Drug Candidate (November 4, 2021), Cassava Sciences
Releases a Public Statement Regarding Recent Allegations (September
3, 2021), and Cassava Sciences Responds to Allegations (August 25,
2021).
About SimufilamSimufilam
(sim-uh-FILL-am) is Cassava Sciences’ proprietary, small molecule
(oral) drug that restores the normal shape and function of altered
filamin A (FLNA) protein in the brain. Cassava Sciences owns
worldwide development and commercial rights to its research
programs in Alzheimer’s disease, and related technologies, without
royalty obligations to any third party.
About Cassava Sciences,
Inc.Cassava Sciences, Inc. is a clinical-stage
biotechnology company based in Austin, Texas. Our mission is to
detect and treat neurodegenerative diseases, such as Alzheimer’s
disease. Our novel science is based on stabilizing—but not
removing—a critical protein in the brain. The Company’s product
candidates have not been approved by any regulatory authority and
their safety, efficacy or other desirable attributes have not been
established.
For more information, please
visit: https://www.CassavaSciences.com
For More Information Contact:
Eric Schoen, Chief Financial Officer, (512) 501-2450,
oreschoen@CassavaSciences.com
Cautionary Note Regarding
Forward-Looking Statements: This news release contains
forward-looking statements, including statements made pursuant to
the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995, relating to our legal strategy and plans and
their expected outcomes. These statements may be identified by
words such as “may,” “anticipate,” “believe,” “could,” “expect,”
“would”, “forecast,” “intend,” “plan,” “possible,” “potential,” and
other words and terms of similar meaning. Such statements are based
largely on our current expectations and projections about future
events. Such statements speak only as of the date of this news
release and are subject to a number of risks, uncertainties and
assumptions, including, but not limited to, those risks relating to
the filing of a legal complaint, our allegations and claims in the
legal complaint, and including those described in the section
entitled “Risk Factors” in our Annual Report on Form 10-K for the
year ended December 31, 2021, and future reports to be filed with
the SEC. The foregoing sets forth many, but not all, of the factors
that could cause actual results to differ from expectations in any
forward-looking statement. In light of these risks, uncertainties
and assumptions, the forward-looking statements and events
discussed in this news release are inherently uncertain and may not
occur, and actual results could differ materially and adversely
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related to our business, investors should consult our filings with
the SEC, which are available on the SEC's website at
www.sec.gov.
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