Namaste Technologies (TSXV: N) announced this morning that it had settled class action lawsuits that were commenced against the firm in 2018. The class action was a result of findings in Citron Research’s short report against the firm, which claimed self dealing was occurring Namaste Tech.
Total settlements amount to US$4.9 million for the settlement of the suits. $2.15 million will go towards suits brought forward in the US, while $2.75 million will go towards those filed in Canada. Namaste expects that its total contribution for the settlement will amount to less than US$500,000 thanks to current insurance that is in place for such instances.
“Settling these class action lawsuits removes a major business and capital markets distraction, while clearing our path ahead to increase resources and focus on what will grow the Company. We’re on track to becoming the world’s most customer focused cannabis marketplace, and this settlement is a win-win for Namaste Shareholders and business partners alike.”
Meni Morim, Interim CEO of Namaste Technologies
The lawsuits were primarily focused on false or misleading statements related to the divestment of Dollinger US in 2017, as well as statements made regarding listing on the NASDAQ exchange which were made by certain members of management.
It is believed that one outstanding lawsuit still stands against the first, related to a $90 million claim for breach of contract. The company however believes that this claim is without merit and aims to defends itself within court on the matter.
The class action lawsuits were settled without any admission or finding of liability. They remain subject to court approval.
Namaste Technologies closed yesterdays session at $0.50.
Information for this analysis was found via Sedar and Namaste Technologies. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.
