NEW YORK, Jan. 29, 2019 /CNW/ -- Pomerantz LLP announces that a class action lawsuit has been filed against Liberty Health Science Inc. ("Liberty" or the "Company") (OTCMKTS: LHSIF) and certain of its officers. The class action, filed in United States District Court, Southern District of New York, and indexed under 19-cv-00161, is on behalf of a class consisting of all persons and entities, other than Defendants and their affiliates, who purchased or otherwise acquired Liberty common stock between June 28, 2018, and December 3, 2018, both dates inclusive (the "Class Period"), seeking to recover damages caused by Defendants' violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 10b-5 promulgated thereunder, against the Company and certain of its top officials.
If you are a shareholder who purchased Liberty Class A common stock between June 28, 2018, and December 3, 2018, you have until March 8, 2019, to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at [email protected] or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
Liberty was incorporated under the Business Corporations Act (British Columbia) on November 9, 2011, as SecureCom Mobile Inc. The Company's principal business activity is the production and distribution of medical cannabis through its wholly-owned subsidiary DFMMJ LLC (d/b/a Liberty Health Sciences Florida Ltd.)
Aphria Inc. ("Aphria"), which also produces and distributes cannabis, has had longstanding ties with Liberty, starting from the very beginning of both companies. When Aphria was founded in 2014, Victor Neufeld ("Neufeld") joined the firm as CEO and co-founder. One of Aphria's other early institutional backers included The Delavaco Group, Front St. Capital, York Plains, and Broadband Capital of NYC.
Neufeld became the Chairman of Liberty while Cole Cacciavillani, Aphria's chief agronomist and co-founder, also became one of the executives at Liberty. Liberty was heavily influenced by Aphria and individuals involved in the management of Aphria. Neufeld and the Serruya are large shareholders in both companies.
The complaint alleges throughout the Class Period, Defendants made materially false and misleading statements regarding the Company's business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Liberty, in conjunction with Aphria, was involved in a scheme whereby numerous fraudulent acquisitions and transactions were made to provide undue benefits to both companies' insiders; and (ii) as a result, Liberty's public statements were materially false and misleading at all relevant times.
In September 2018, Aphria announced that it had sold off its stake in Liberty. On December 3, 2018, Quintessential Capital Management and Hindenburg Research issued a report entitled "Aphria: A Shell Game with a Cannabis Business on the Side," claiming that Aphria was part of a scheme involving the acquisition of shell companies at artificially inflated prices. Specifically, the report alleged: "Aphria is part of a scheme orchestrated by a network of insiders to divert funds away from shareholders into their own pockets." The article detailed a thorough and on-the-ground investigation into Aphria's latest investments that revealed the poor quality and worth of the assets of those investments. For example, the article was accompanied by pictures showing that Aphria's latest investment in Jamaica was an abandoned building on dilapidated property.
On this news, Liberty's stock fell $0.36, or nearly 34%, over the next two trading days to close at $0.70 on December 4, 2018.
The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, and Paris, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com
Robert S. Willoughby
888-476-6529 ext. 9980
SOURCE Pomerantz LLP