An Aytu BioPharma Inc. investor filed suit in Delaware against its former financial backer, Armistice Capital LLC, claiming the hedge fund engaged in a “dump and dump” scheme aimed at unloading unprofitable affiliates on the drug company before exiting its own stake through insider trades.
The lawsuit filed in the state’s Chancery Court also targets members of the Aytu board. It accuses them of rubberstamping the “systematic looting,” standing aside while Armistice liquidated its entire investment position just after the company’s stock price spiked in March 2020 on news about a distribution deal for its Covid-19 test kits.
The hedge ...
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