News Article: Melnyk suing Acerus Pharmaceuticals (Trimel) after significant losses

[Very Stable Genius]

Ruh-roh

http://www.theglobeandmail.com/repo...erus-for-gross-mismanagement/article29089461/

Mr. Melnyk’s personal fortune has been the subject of much speculation over the past several years with the Ottawa Citizen reporting in August, 2013, that his “once-staggering wealth” topping more than $1.5-billion had shrunk significantly since he bought the Senators in 2003 and was now in the hundreds of millions.

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[Benjamin]

Hopefully he sues them for exactly 5.5 X 5 27.5 million.

 

[Mingus Dew]

So he's suing for breach of the duty of care?

Good luck with that.

 

[topshelf15]

Hopefully he cashes in the sens sooner than later ,guy doesnt have the $ to build a contender

 

[Very Stable Genius]

Suing both companies he founded
5 year ban from hold a senior position at a public company.
Health issues
Divorced


The man has a whole whack of problems.

 

[FolignoQuantumLeap]

The stocks are sitting at 9 cents. Ouch.

I don't think this is really a good or bad thing for fans of the Sens. He wouldn't be taking legal action if he A. Didn't have the funds to mount this kind of attack and B. Counsel didn't think there was a case.

On a side note, good god are publicly traded companies a cancer to society.

 

[BonkTastic]

Suing company for $145 million. Company is currently valued at $20 million.

Stocks were trading at $4.45 per share in 2012. Currently trading at $0.09 per share. In case you aren't down with the maths, the stock has gone down 98% in under four years. NINETY. EIGHT. PERCENT.



... legit worried about Eugene's financial wherewithal to ever commit to being able to support this franchise as anything more than a budget team. He's attempting to sue his own company for over 700% of what it is worth. Like... just read that again. Not good.

 

[Mingus Dew]

The stocks are sitting at 9 cents. Ouch.

I don't think this is really a good or bad thing for fans of the Sens. He wouldn't be taking legal action if he A. Didn't have the funds to mount this kind of attack and B. Counsel didn't think there was a case.

On a side note, good god are publicly traded companies a cancer to society.

Don't be so confident in (B). Plenty of frivolous lawsuits in this space.

As a general rule, you can't just sue a Board for doing a crappy job (in pure performance terms), because courts refuse to analyze the correctness of a given business decision using hindsight bias. Melnyk basically needs to show that Directors failed to exercise due care in coming to their crappy decisions, which is a different animal.

 

[topshelf15]

Suing company for $145 million. Company is currently valued at $20 million.

Stocks were trading at $4.45 per share in 2012. Currently trading at $0.09 per share.



... legit worried about Eugene's financial wherewithal to ever commit to being able to support this franchise as anything more than a budget team. He's attempting to sue his own company for over 700% of what it is worth. Like... just read that again. Not good.

Thinking its only a matter of time before he needs to sell ,that other lebreton group could make ,AN OFFER SOON THAT HE REALLY CANT REFUSE

 

[JonnyMacSen]

Is this happening on top of his forensic investigation on Matt Cooke?

 

[Very Stable Genius]

I do find it funny that he became a whistleblower against Valeant after he left the company. He's accusing them of masquerading as a Canadian company while being based in the U.S to avoid taxes. A little rich coming from a guy who moved to Barbados in part to avoid taxes.

 

[Mingus Dew]

Valeant's issues are more about wonky accounting than tax offshoring, tbh.

 

[BonkTastic]

Melnyk has to be hoping for a settlement.

Derivative lawsuits are becoming en vogue lately, with lots of out-of-court settlements. The kink here is that the companies who settle tend to be successful companies with lots of fluid assets, not failing enterprises who are hemmhoraging out their ears.

 

[Zorf]

So how is Melnyk supposed to build a new stadium if he doesn't have the money for it? I know the Illumination Lebreton proposal has a bunch of partners (I think it was 29), but would all of them be expected to pony up funds for the stadium? Or will it be a MASSIVE bank loan?

The city has already said they will not commit any money to the construction of the stadium, the Feds don't get involved with that sort of stuff, the Ontario government is as broke as a joke. So assuming there are no public funds coming in, how is Melnyk expecting to fund this massive project?

 

[PeterSidorkiewicz]

Anyone else and they're deemed crazy but because he's rich he's probably just labeled as "eccentric". Does anyone actually like Melnyk anymore? Well I guess the guy who donated his liver does.

 

[Very Stable Genius]

So how is Melnyk supposed to build a new stadium if he doesn't have the money for it? I know the Illumination Lebreton proposal has a bunch of partners (I think it was 29), but would all of them be expected to pony up funds for the stadium? Or will it be a MASSIVE bank loan?

The city has already said they will not commit any money to the construction of the stadium, the Feds don't get involved with that sort of stuff, the Ontario government is as broke as a joke. So assuming there are no public funds coming in, how is Melnyk expecting to fund this massive project?

He said it would be privately funded, by whom, I'm not so sure.

 

[PeterSidorkiewicz]

He said it would be privately funded, by whom, I'm not so sure.

A gofundme account is in the works.

 

[Alfie#11]

Melnyk is just grasping at straws at this point.

He's done as a super rich person. Give up the trappings (Sens) and go enjoy your still considerable wealth Eugene.

Not only does this type of stuff indicate he probably doesn't have the money to fund the Sens properly, it also makes you think he will try to squeeze the team as a revenue source even more.

 

[Very Stable Genius]

A gofundme account is in the works.

Surprise!

We said it was going to be privately funded, but instead of the government giving us your money, YOU just give us your money. There. Private donations, no public money just like we promised.

 

[Qward]

So the company was valued at .11/share at IPO. Melnyk gets involved and valuation jumps to 1.58 after he puts up 30M in equity. CompleoTRT gets pushed back and back and back and now he is trying to get more than his initial investment? k...

 

[Boud]

Not too sure about this particular company but Pharmaceuticals companies are worth money based on their R&D but there never is any certainty in the end.

I wouldn't be surprised if he invested significantly and the particular products just aren't good enough or there are many substitute products. Pharmaceuticals is a cut throat business, I'm surprised Eugene invested in this field. It's extremely risky and for a guy that keeps talking about his financials it seems that the logical thing to do is to not invest significant amount of money in such a business.

There's definitely some information missing here but there's no way Eugene would be able tor recover that money. What kind of assets does this company have for 145M? Might as well just file bankruptcy...

 

[bert]

Suing company for $145 million. Company is currently valued at $20 million.

Stocks were trading at $4.45 per share in 2012. Currently trading at $0.09 per share. In case you aren't down with the maths, the stock has gone down 98% in under four years. NINETY. EIGHT. PERCENT.



... legit worried about Eugene's financial wherewithal to ever commit to being able to support this franchise as anything more than a budget team. He's attempting to sue his own company for over 700% of what it is worth. Like... just read that again. Not good.

Hopefully the NCC is taking this into consideration with the bid at lebreton flats. What bank would finance this guy anyways? They are getting tighter and tighter with the crashing dollar.

 

[Boud]

Hopefully the NCC is taking this into consideration with the bid at lebreton flats. What bank would finance this guy anyways? They are getting tighter and tighter with the crashing dollar.

I don't think he's going through any bank.

And look at his assets. Melnyk may have less money but assets are assets. As long as you have something your lenders can retrieve their money from they will lend you money.

 

[topshelf15]

I don't think he's going through any bank.

And look at his assets. Melnyk may have less money but assets are assets. As long as you have something your lenders can retrieve their money from they will lend you money.

He has leveraged the hell out of the team,and claims its not worth money .Yet banks have lent him 100,s of millions against it

 

[OgieO]

Suing company for $145 million. Company is currently valued at $20 million.

Stocks were trading at $4.45 per share in 2012. Currently trading at $0.09 per share. In case you aren't down with the maths, the stock has gone down 98% in under four years. NINETY. EIGHT. PERCENT.



... legit worried about Eugene's financial wherewithal to ever commit to being able to support this franchise as anything more than a budget team. He's attempting to sue his own company for over 700% of what it is worth. Like... just read that again. Not good.

One of two things happened:

1. He pulled an O'Leary to Mattel and ripped them off. That seems highly unlikely based on his current actions and remaining the third largest shareholder after the transaction.
2. Those that took over ran it into the ground with a special kind of incompetence. Hard to reduce a company to rubble like that so quickly. Hard to have losses of 9M on revenues of 16M.

Perhaps he has a case. I don't know much more than what i hear in teh news, which is to say I don't know much.