On Thursday, Abby Spanier, LLC announced they would be filing a class action lawsuit against SFX on behalf of the company’s shareholders, following misleading statements issued by CEO Robert Sillerman. Allegedly, Sillerman gave ongoing confirmation that he intended to buyout the company’s common stock when he, in fact, possessed nowhere near the amount of funds to do so. The complaint of the suit stems from Sillerman’s dishonesty to the shareholders, as he never disclosed the truth of his financial inability to complete the transaction.
Defendant Sillerman knew or recklessly disregarded and failed to disclose that he did not have any financing in place at the time he made his proposal and knew or recklessly disregarded that he could not obtain the financing to consummate the transaction.
Furthermore, due to SFX’s dwindling market stability and growing debt, it can be assumed that Sillerman and the other defendants never intended to purchase the stock in the first place. According to the Complaint,
Sillerman initiated and maintained a sham process designed to lure third party offers, in an attempt to shed his failing investment before the truth about the deterioration of the Company could no longer be concealed.
Through this method, they were able to inflate the market price of SFX, effectively masking the company’s deteriorating finances.
The attorneys at Abbey Spanier, LLP have extensive experience in securities class action cases, and have played lead roles in major cases resulting in the recovery of over one billion dollars for investors.
With Sillerman’s debauchery now in the spotlight, and with the experienced team at Abbey Spanier leading the charge, it seems that the shareholders will soon find justice and compensation for their investments. SFX is in big trouble, now.