Ryan O’Dell, a shareholder, filed a complaint against Sierra Inc., and its board of directors, alleging the defendants of violating the Securities Exchange Act.
Sierra Oncology is a late-stage biopharmaceutical company which engages in researching, developing, and commercializing treatments for patients with oncological needs, the complaint said. On April 13, the defendant and GSK proposed a merger. The complaint alleges the defendants have filed a materially incomplete and misleading Preliminary Proxy Statement to the SEC on May 2, which was disseminated to shareholders.
The board members, the plaintiff says, were obligated to carefully review this statement to ensure it was free of misleading information, misrepresentation, and/or omissions, as shareholders rely on these statements in order to make informed decisions about their shares and votes. The complaint says that specific misleading information pertains to financial projections. The plaintiff claims that the proxy statement includes non-Generally Accepted Accounting Principles (GAAP) metrics, but not a a reconciliation to the equivalent GAAP metrics.
The plaintiff seeks the following relief: a preliminary and permanent injunction against the defendants, preventing them from proceeding with the proposed transaction, a rescission of the merger agreement or a grant of rescissory damages, a direction of the defendants to account for all damages done to plaintiff, and an award of costs and reimbursements to the plaintiff.The plaintiff is represented by Melwani and Chan LLP.