I can't imagine why anyone would think that the charges would turn out to be trumped up. I think they are quite airtight. The SEC has chosen something very tangible (financial statements) upon which to base their case. There are lots of other things that JBI could be accused of, but financial statements filed and then restated are tangible.
As far as I can remember, the main issue was not acquisitions, but the timing of the most recent PIPE prior to the restatement of the Financial Statements. Basically, at the time the PIPE was negotiated, the stock price was very favourable. Upon the restatement, it plummeted to current levels, with some recovery in between at times.
It has been said that no one bought the PIPE shares because of Media Credits. Well, not so fast. They are an atractive asswet and promise lots of hpye and publicity. I remember the iHub board at this time. It was rife with speculation about the potential lift to the company that these media credits would result in. I remember discussion of various infomercial marketing of Pak-It products. Whose name was mentioned... Billie Mays? I looked it up, seems I am right.
THe basis of misrepresentation is not so much whether or not the CEO knew about the true value of the Media Credits, but that as CEO he OUGHT to have known. At the end of the day, the Skype calls and other evidence will not matter that much.
I do believe that some settlement will be reached that may or may not kill JBI. But I don't doubt the validity of the charges.
And to think that this author is a message board poster? Dream on...
