Court of Appeal Dismisses Motion for Leave to Appeal Brought by Dr. Raza Bokhari, FSD Pharma Awards Total Approximately $3 Million
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Insights
The affirmation by the Court of Appeal for Ontario regarding the judgment against Dr. Raza Bokhari holds significant legal implications for FSD Pharma and its shareholders. The confirmation of the arbitration awards, which includes the dismissal of wrongful dismissal claims and the awarding of fees and costs, represents a favorable outcome for the company from a legal standpoint. It indicates a successful defense against claims that could have potentially resulted in substantial financial liabilities.
From a legal perspective, the process of confirming arbitration awards across borders—in this case, between Canada and the United States—demonstrates the enforceability of such awards and the company's proactive approach in seeking remedy. The legal costs awarded, although relatively minor in comparison to the company's overall financials, serve as a deterrent against frivolous litigation and underscore the importance of proper legal strategies in corporate governance.
The financial implications of the judgment are twofold for FSD Pharma. Firstly, the recovery of CDN $2.81 million, plus additional costs, provides a direct financial benefit to the company's balance sheet. This could potentially be reflected as a one-time gain in the company's financial statements, subject to accounting treatments of legal recoveries. It is important to note, however, that the collection process can be lengthy and is not guaranteed, potentially impacting the timing and actual realization of these funds.
Secondly, the resolution of this legal matter may positively influence investor sentiment by reducing the uncertainty surrounding the company's legal affairs. A successful defense against wrongful dismissal claims can also be seen as an indirect indicator of robust management practices, which could enhance the company's reputation among investors and stakeholders.
An assessment of the broader biopharmaceutical market suggests that legal disputes and their resolutions can have a material impact on a company's strategic focus and resource allocation. For FSD Pharma, the resolution of this legal dispute allows the company to redirect its attention and resources towards core activities such as research and development of treatments for neurodegenerative and metabolic disorders. This can be particularly important in the biopharmaceutical industry, where innovation and speed to market are critical factors for success.
Understanding the competitive landscape, it is essential for FSD Pharma to maintain a strong pipeline and effectively manage its financial and legal risks. The conclusion of this legal matter may provide the company with a more stable platform to pursue its strategic objectives and potentially improve its standing in the highly competitive biopharmaceutical sector.
TORONTO, ON / ACCESSWIRE / February 6, 2024 / FSD Pharma Inc. (NASDAQ:HUGE)(CSE:HUGE)(FRA:0K9A) ("FSD Pharma" or the "Company"), a biopharmaceutical company dedicated to building a portfolio of innovative assets and biotech solutions for the treatment of challenging neurodegenerative and metabolic disorders, announced that the Court of Appeal for Ontario affirmed the Judgment entered by the Superior Court of Justice in the amount of CDN
In December 2023, FSD Pharma filed a Petition to Confirm Arbitration Awards in the United States District Court for the Eastern District of Pennsylvania. This begins the process by which FSD Pharma will collect from Dr. Raza Bokhari the amounts awarded by the Arbitrator.
About FSD Pharma
FSD is a biopharmaceutical company dedicated to building a portfolio of innovative assets and biotech solutions for the treatment of challenging neurodegenerative and metabolic disorders and alcohol misuse disorders with drug candidates in different stages of development. Through its wholly-owned subsidiary, Lucid Psycheceuticals Inc. ("Lucid"), FSD is focused on the research and development of its lead compound, Lucid-MS (formerly Lucid-21-302) ("Lucid-MS"). Lucid-MS is a patented new chemical entity shown to prevent and reverse myelin degradation, the underlying mechanism of multiple sclerosis, in preclinical models. FSD has also licensed UNBUZZD™, a proprietary formulation of natural ingredients, vitamins, and minerals to help with liver and brain function for the purposes of quickly relieving individuals from the effects of alcohol consumption for use in the consumer recreational sector, to Celly Nutrition Corp. ("Celly Nu") and is entitled to a royalty on the revenue generated by Celly Nu from sales of products created using the technology rights granted under the licensing agreement. FSD continues its R&D activities to develop novel formulations for alcohol misuse disorders and continues the development of such treatments for use in the healthcare sector. FSD maintains a portfolio of strategic investments through its wholly-owned subsidiary, FSD Strategic Investments Inc., which represent loans secured by residential or commercial property.
Cautionary Note Regarding Forward-Looking Information
This press release contains forward-looking statements and forward-looking information (collectively, "forward-looking statements") within the meaning of applicable securities laws. Any statements that are contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "plans", "expects", "expected", "scheduled", "estimates", "intends", "anticipates", "hopes", "planned" or "believes", or variations of such words and phrases, or states that certain actions, events or results "may", "could", "would", "might", "potentially" or "will" be taken, occur or be achieved. More particularly, and without limitation, this press release contains forward-looking statements contained in this press release include statements concerning the future of FSD Pharma and are based on certain assumptions that FSD Pharma has made in respect thereof as of the date of this press release, including, the terms the letter of intent and investor relations agreements and the benefits to and obligations of FSD Pharma thereunder. FSD Pharma cannot give any assurance that such forward-looking statements will prove to have been correct.
Since forward-looking statements relate to future events and conditions, by their very nature they require making assumptions and involve inherent risks and uncertainties. The Company cautions that although it believes the expectations and material factors and assumptions reflected in these forward-looking statements are reasonable as of the date hereof, there can be no assurance that these expectations, factors and assumptions will prove to be correct and these risks and uncertainties give rise to the possibility that actual results may differ materially from the expectations set out in the forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to a number of known and unknown risks and uncertainties including, but not limited to: the timing and ability to satisfy all applicable listing and regulatory requirements of the CSE and Nasdaq; the fact that the drug development efforts of the Company and Lucid are at a very early stage; the fact that preclinical drug development is uncertain, and the drug product candidates of the Company and Lucid may never advance to clinical trials; the fact that results of preclinical studies and early-stage clinical trials may not be predictive of the results of later stage clinical trials; the uncertain outcome, cost, and timing of product development activities, preclinical studies and clinical trials of the Company and Lucid; the uncertain clinical development process, including the risk that clinical trials may not have an effective design or generate positive results; the potential inability to obtain or maintain regulatory approval of the drug product candidates of the Company and Lucid; the introduction of competing drugs that are safer, more effective or less expensive than, or otherwise superior to, the drug product candidates of the Company and Lucid; the initiation, conduct, and completion of preclinical studies and clinical trials may be delayed, adversely affected or impacted by unforeseen issues; the potential inability to obtain adequate financing; the potential inability to obtain or maintain intellectual property protection for the drug product candidates of the Company and Lucid; and other risk; and the inability of the Company to carry out the terms and realize upon the benefits of the letter of intent and investor agreements. Accordingly, readers should not place undue reliance on the forward-looking statements contained in this press release, which speak only as of the date of this press release.
Further information regarding factors that may cause actual results to differ materially are included in the Company's annual and other reports filed from time to time with the Canadian Securities Administrators on SEDAR+ (www.sedarplus.ca) and with the SEC on EDGAR (www.sec.gov), including the Company's Annual Report on Form 20-F for the fiscal year ended December 31, 2022, the Prospectus and Registration Statement, each under the heading "Risk Factors". This list of risk factors should not be construed as exhaustive. Readers are cautioned that events or circumstances could cause results to differ materially from those predicted, forecasted or projected. The forward-looking statements contained in this document speak only as of the date of this document. FSD Pharma does not undertake any obligation to publicly update or revise any forward-looking statements or information contained herein, except as required by applicable laws. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.
Neither the CSE nor its regulation services provider accept responsibility for the adequacy or accuracy of this release.
Contacts:
FSD Pharma Inc.
Zeeshan Saeed, Founder, CEO and Executive Co-Chairman of the Board, FSD Pharma Inc.
Email: Zsaeed@fsdpharma.com
Telephone: (416) 854-8884
Investor Relations
Email: ir@fsdpharma.com, info@fsdpharma.com
Website: www.fsdpharma.com
SOURCE: FSD Pharma Inc.
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