Biotech Firm Genapsys Defeats Founders’ Bid to Dismiss Bankruptcy

Genapsys Inc., a gene sequencing technology developer, convinced a court to let it remain in bankruptcy and proceed to an auction with a $42 million starting bid, defeating the company founders’ bid to dismiss the case.

Former CEO Hesaam Esfandyarpour and fellow co-founder Kosar Parizi had alleged that an improperly seated board of directors hastily put the cash-strapped company in bankruptcy.

The circumstances surrounding Genapsys’ July filing for bankruptcy are “unusual,” but the company has shown it had valid approval from its board of directors to start its case, Judge Brendan Shannon of the US Bankruptcy Court for the District ...