Spanish blood plasma company Grifols has launched a lawsuit against Gotham City Research over a report alleging the company has overstated its profit and misstated its accounting, according to a report by Bloomberg.
In the complaint, which was filed in a federal court in New York, Grifols described Gotham City Research and its Principals Daniel Yu and Cyrus de Weck, as “predatory short sellers” who illicitly profit from “rigged short-and-distort schemes.”
The research company serves as the publishing arm of General Industrial Partners, a hedge fund that was formed following the merger of Gotham City and shorts seller fund Portsea Asset Management.
In the lawsuit, Grifols said: “Unlike other short sellers, defendants crossed the line with their attack on Grifols by knowingly making false and misleading statements in furtherance of a single illegal purpose: to manipulate the value of Grifols’ stock for their own monetary gain.”
Earlier this month, Gotham City released a report which claimed that Grifols artificially reduced leverage by consolidating earnings of units it does not control as well as overstating profit. The company’s shares have fallen 38% this year.
In turn, Grifols claims that the report contains “malicious falsehoods and distortions” and was designed “to cause a market panic” after Gotham City “amassed a large short position” in the business.
