SEC Brings Charges in Short-and-Distort Scheme
Publication Date: September 14, 2018

The Securities and Exchange Commission has charged hedge fund adviser, Gregory Lemelson and his investment advisory firm, Lemelson Capital Management LLC, with illegally profiting from a scheme to drive down the price of Ligand Pharmaceuticals Inc., resulting in more than $1.3 million of gains. The SEC's complaint alleges that Lemelson used written reports, interviews, and social media to spread untrue claims. David Becker, an Assistant Director in the SEC's Division of Enforcement stated that, "while short-sellers are free to express their opinions about particular companies, they may not bolster those opinions with false statements, which is what we allege Lemelson did here."