Stem cell clinic biotech Stemedica has just been sued by one of its own board members based on allegations related to money the company raised, according to CourtHouseNews. The actual suit, filed by an investment company Tiara Holdings and board member Anthony Marlon, can be read here.
“Tiara Holdings II LLC sued Stemedica Cell Technologies Inc. and its top three officers on April 6 in Clark County Court. The officers are CEO and Chairman of the Board Roger Howe, Vice Chairman and CEO Maynard Howe and President and Chief Medical Officer Nikolai Yankovich.”…Dr. Anthony M. Marlon, a medical doctor and businessman, holds 430,000 shares of Stemedica through Tiara Holdings, where he is a member. He also is a member of the board of Stemedica, he says in the complaint.”
Note that “Yankovich” seems to be a typo as the Stemedica leader in question is Nikolai Tankovich.
The allegations in the suit are summarized by CourtHouseNews this way:
“Stemedica’s founders have operated a nearly 10-year investment scheme, wherein they have raised over $110 million dollars from various individual investors for the purported purpose of funding and establishing a stem cell company,” Tiara says in the lawsuit.
Tiara claims the Howes and Tankovich “have used these investor funds, in whole or in part, to benefit themselves and their associates through excessive compensation and lavish personal expenses and related party transactions.”
“Stemedica’s founds have concealed and perpetuated this fraud through purported operating subsidiaries, which permitted them to divert millions to benefit them without raising questions or concerns from Stemedica’s investors and shareholders,” Tiara says.”
“It also seeks damages and punitive damages for fraud, breach of fiduciary duty, unjust enrichment and bad faith.”
Maynard Howe reportedly told CourtHouseNews that the allegations are false.
The Stemedica website still lists Dr. Marlon as a board member (see screenshot above).
Stemedica has seen some other past controversy as in part noted in the new suit related to a KPBS investigation of the San Diego company and ties reported in that piece to the stem cell transplants received by patient Jim Gass, who later developed a spinal tumor. The origin of Gass’s tumor remains unknown to my knowledge and may have had nothing to do with Stemedica’s cells, but the stem cell community would benefit from more clarity on that situation. Stemedica also garnered major media attention further back for its role in a non-FDA-approved stroke treatment received outside the U.S. by hockey legend Gordie Howe (no relation to the company’s Howe brothers).
Another San Diego stem cell businesses, Stemgenex, is also the subject of a lawsuit, in its case related to allegations of improper marketing claims. Additional recent stem cell clinic-related lawsuits have been filed, settled, or remain active as I discuss here and here.
Big HT to Alexey Bersenev.