Monday, 27 March 2017
Last updated 18 min ago
Sep 11 2007 | 7:10am ET
The settlement between Canadian pharmaceutical maker Biovail Corp. and Banc of America Securities could be bad news for hedge fund honcho Steven Cohen and his SAC Capital Management.
Yesterday, Biovail settled its market-manipulation suit against BofA and a former analyst, saying that the deal “is expected to be extremely helpful in Biovail’s pursuit of its lawsuit” against SAC, related entities and persons, and independent research firm Gradient Analytics. But the “substantial sworn testimony” that ex-analyst David Maris is set to provide, along with possibly additional evidence from BofA, are reportedly not coming cheap: The New York Post reports that, under the terms of the settlement, Biovail will pay some $2 million to Maris and BofA to cover legal expenses.
Biovail alleges that SAC helped “ghost write” negative and false research reports about it for the furtherance of its own benefit; SAC had shorted Biovail stock in 2003 and 2004.
Both SAC and Gradient have denied any wrongdoing.