Court accepts complaint against Gotham for spreading 'biased and misleading' information about Grifols
Judge believes short-selling fund sought to benefit from fall in Catalan pharmaceutical company's stock value
Spain's National Court has accepted a complaint from the Anti-Corruption Prosecutor's Office against the short-selling fund Gotham, General Industrial Partners LLP (GIP), and some of its executives for allegedly spreading "biased and misleading" information about Grifols.
The report on Grifols in January aimed to encourage investors to sell their shares and cause a drop in the stock price to benefit the two companies being investigated, the complaint alleges.
The Anti-Corruption Prosecutor believes they may have possibly committed crimes against the market and consumers.
In his ruling, Judge José Luis Calama sees signs of a crime and examines the messages from Gotham on X (formerly Twitter) on January 8 and 9, in which they claimed that the value of Grifols' shares was zero.
As a result, on January 9, Grifols recorded losses of €3.814 billion at the close of trade.
In its report, Gotham indicated that it is a subsidiary of General Industrial Partners and that it held a "short" position in Grifols, greater than 0.5% of the company's share capital. After the publication of the report, the short position was reduced to 0.06%.
According to Judge Calama's ruling, the short sale operation earned General Industrial Partners a capital gain of €9.4 million. Therefore, the conditions are met to investigate a potential crime related to the market and consumers.
Specifically for spreading economic data "either totally or partially false, with the potential to alter or preserve" the price of Grifols' shares.
Judge requests addresses
The judge has requested a copy of all the documents the Spanish Securities Market Commission (CNMV) sent to the Anti-Corruption Prosecutor's Office.
It has also asked the CNMV to locate the addresses of the five individuals at the head of Gotham, including Daniel Yu and Cirus de Weck, and at GIP.
As for Grifols, Calama has asked whether the company intends to join the legal proceedings. He has also requested a copy of the lawsuit Grifols filed before the District Court of New York.
The judge also inquired if Grifols had reported the matter to the financial market regulators in the United States and the United Kingdom.
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