On Friday a case was filed in the Massachusetts District Court. The case was filed as a shareholder derivate action by Joshua Myers and Peter D’Arcy on behalf of Sesen Bio Inc. against the directors and officers of the company. The shareholders allege breach of fiduciary duty, unjust enrichment, and violation of the Securities and Exchange Act.
Sesen, the complaint said, is a clinical trial company focused on targeted fusion proteins, currently being explored as treatments for cancer. The current focus is on Vicineum, which is in trials for bladder cancer among other possibilities, per the plaintiffs.
The treatment protocol involves application of the protein via a catheter into the bladder, then after the protein interacts with the bladder it is excreted without interacting with any other body systems, theoretically. However, the plaintiffs states that the trials were plagued with thousands of protocol violations, misconduct of the investigators, and suppressed information as to possibly toxicity of the product to the patient, not just the cancer. The plaintiffs say that the omission of the information from Biologics License Application and from Securities and Exchange Commission filings constituted false and misleading statements and artificially inflated the value of the stock.
The plaintiff is suing for violations of Section 14(a) of the Exchange Act, breach of fiduciary duty, unjust enrichment, abuse of control, gross mismanagement, waste of corporate assets, and contribution. Plaintiffs are represented by Gainey McKenna & Egleston, the Brown Law Firm P.C., Hutchings Barsamian Mandelcorn LLP , and the Law Office of Michael P. Utke LLC.
