Ernest Badway was quoted in the Crain's New York Business article "The Tweet Heard by the Street." While the full text can be found in the January 13, 2014, issue of the Crain's New York Business, a synopsis is noted below.
A patient suffering from ALS recently wrote on her blog that she is responding well to her treatment in a clinical drug trial. The company that makes the drug posted a link to the blog post on its Twitter account shortly after, a move that caused shares in the company to jump 26 percent just as they were looking to raise $20 million in new capital.
In the company's eagerness to draw attention to its ALS treatment, however, securities lawyers have noted it violated the rule that companies can't release important news when they're in the process of raising cash unless they update their prospectus.
"They crossed the line, clearly," said Ernest Badway.
"They play fast and loose," Badway said of the company' investment bankers.
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