Genius Group (NYSEMKT:GNS) stock is accelerating higher today after the company announced in a press release that it had appointed and retained attorney Mark R. Basile and his toxic debt litigation firm, The Basile Law Firm. Basile will act as Special Counsel, joining Genius’ legal team in its complaint against Ayrton Capital and several other parties.
Genius Group CEO Roger Hamilton had the following to say:
“We are pleased to welcome Mr. Basile to our legal team. Mr. Basile understands how toxic loans negatively affect retail shareholders and will be assisting our counsel in this and other litigation we plan.”
Basile has focused his efforts on convertible toxic debt litigation for the past seven years. The Basile Law Firm saw a massive victory in 2021 after it “set the standard to save hundreds of public companies’ tens of millions of dollars.” Since then, the firm has helped vacate several federal trial court judgments, which has resulted in a lower rate of lawsuits filed by toxic lenders.
GNS Stock: Genius Brings on Toxic Debt Specialist
So, what exactly are the reasons for Genius’ complaint? Besides Ayrton and Waqas Khatri, its Managing Member, the other defendants are Alto Opportunity Master Fund and SPC — Segregated Master Portfolio B. Specifically, the complaint seeks an order to rule Genius’ financing agreement with Ayrton null and void. Warshaw Burstein and Christian Levine Law Group will assist Genius with the case.
Genius argues that Ayrton is an unregistered dealer that has participated in an unlawful scheme. As a result, the company believes that Ayrton has violated the Securities Exchange Act of 1934. Ayrton allegedly did this by receiving millions of shares of GNS stock at a discount in order to sell them for a profit.
Meanwhile, Ayrton believes it has a financing agreement with Genius. According to Ayrton, it should receive 49 million shares worth around $200 million in exchange for an $18 million loan. The agreement was made on Aug. 26 when GNS stock traded at about $2.60 per share.
Shareholders should obviously side with Genius, as a ruling in favor of Genius would mean less dilution. As of now, it appears that an initial hearing has not yet been scheduled.
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On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.