Nice post from Facebook Cytodyn page.
CYTODYN VS 13D POINTS PART 3:
Last week the 13D group submitted their answers to claims to the court. The next day the judge issued an order of protection.
I have read the full 13 page order and it's basically just a court ordered NDA, with specific directions for how to handle documents containing sensitive info during discovery.
So it would appear the judge read the answers and determined it was prudent to move forward with discovery.
13D supporters will probably shout the judge saw something that convinced her 13D had a solid argument, I however see it different. In my opinion, the judge simply could not understand fully the answers by 13D and decided to err on the side of caution by moving forward.
To prove my hypothesis, let's break down two of the 13D answers. Why two? Because while being pages apart, they are interrelated questions and answers.
From Page 11
THE SIDLEY CLAIM:
...Dr. Patterson claims that 596,242 shares of (Cytodyn) are held beneficially by Incelldx...
The claim says Dr. Patterson in one place says he owns all those shares himself but in another place says it is Incelldx that owns the shares which means the shares are only partially owned by BP.
13D RESPONSE:
... Dr. Patterson is the beneficial owner of 596,242 shares of common stock of (Cytodyn). Dr. Patterson has requested that (Cytodyn) re-register these shares in the name of Incelldx. To Dr. Patterson knowledge this has not been done and the shares remain registered in Dr. Patterson name. Due to the above, Dr. Patterson disclaims beneficial ownership of 596,242 shares...
HUH? WHAT? Can someone "DISCLAIM" ownership of their shares? What the hell does this even mean? (Keep this answer in mind. We will come back to it)
On page 14, we get a related claim and response.
THE SIDLEY CLAIM.
C3) Mr. Beatty response to C1 fails to list the stock options that he indirectly owns through Incelldx's ownership of such options.
THE 13D RESPONSE:
The stock options are not owned by Incelldx. They are registered in the name of Dr. Patterson and he has agreed to register them in the name of Incelldx, when possible. Dr. Patterson has requested that (Cytodyn) release and re-register the shares but (Cytodyn) has not done so and claims they were never granted to Dr. Patterson and his inclusion in (Cytodyn) form S-3.... was erroneous despite not being amended or corrected...
OK, RAISE YOUR HAND IF YOU UNDERSTOOD ALL THAT?
Now let's analyze what they appear to be saying. We will start with the second claim and response.
The claim is simple and straightforward. Mr. Beatty owns a large portion of Incelldx. Incelldx owns 596,242 shares, therefore, Mr. Beatty indirectly owns Cytodyn through his ownership of Incelldx and failed to mention this in the filing.
The first sentence of the 13D answer appears to be a perfect response.
"The stock options are not owned by Incelldx!"
Hey, booyah, case closed. (KEEP THIS ANSWER IN MIND. WE ARE COMING BACK TO IT.) Except it's not. The 13D attorneys felt compelled to clarify the position.
"They are registered in the name of Dr. Patterson and he has agreed to register them in the name of Incelldx when possible."
Wait, what??? Let's analyze that. Notice the change in wording. Incelldx does not OWN shares but referring to Patterson, the shares are REGISTERED. Notice they don't claim the shares are OWNED by Patterson.
Because they aren't. After all the next thing they say is Patterson has agreed to register them in the name of Incelldx.
Why would he do that??? Duh, because they are owned by Incelldx.
The next sentence states Patterson has requested he re-register the shares but Cytodyn has refused (notice the positive/negative reinforcement -- BP is "trying" to do what is right while Cytodyn won't let him) because (Cytodyn) "...claims they were never owned by Patterson and his inclusion... was erroneous.
Okay, basically, there was a clerical error. A typo when filing an S-3. And Patterson was registered in error.
Patterson wants to re-register (basically correct the typo) but Cytodyn claims just because there is a typo, the ownership of the shares didn't change. Therefore, Patterson never owned them, and he can't do anything with shares he never owned.
Remember the answer to the first Sidley claim? BP said he DISCLAIMS ownership of the 596,242 shares. Well, of course, he never owned them, duh!
Which all leads to only one conclusion. Regardless of this typo involving Patterson, the shares were and always have been owned by Incelldx.
Finally, this brings us back to that very first sentence in the answer:
"The stock options are not owned by Incelldx"
BUUUZZZZZZ! INCORRECT!
Now you see why they had to clarify their statement.
Which finally brings us full circle to the Sidley claim. Mr. Beatty owns part of Incelldx which owns 596,242 shares of Cytodyn so Mr. Beatty indirectly owns Cytodyn shares.
Ding, ding, ding, the Sidley claim is correct!!!
Now do you think the judge did all this mental gymnastics? No, she just decided she can't make heads or tails of it and needs to hear direct testimony where she can sort it all out through questioning.
LAWYERS ARE UNDER OATH!!!
Whenever an attorney supplies paperwork to the court they attest that the information contained therein is correct and true to their best belief. An attorney risks their license if they purposefully lie in court documents.
Of course Belief leaves a crack in the door. An attorney could always claim something that turns out to be untrue by accident. But some things don't leave as large a crack.
Sidley has made a claim that Incelldx owns 596,242 shares of common stock in Cytodyn. They didn't pull that number from the Aether. You can wager your bottom dollar they saw the proof and firmly believe in it's veracity and are ready to prove it.
Meanwhile, the 13D answer basically lies, but then clarifies the position with the full truth. The 13D attorney certainly understood what they were writing. They were making very certain there erroneous claims didn't come back to bite them.
CYTODYN VS 13D POINTS PART 3:
Last week the 13D group submitted their answers to claims to the court. The next day the judge issued an order of protection.
I have read the full 13 page order and it's basically just a court ordered NDA, with specific directions for how to handle documents containing sensitive info during discovery.
So it would appear the judge read the answers and determined it was prudent to move forward with discovery.
13D supporters will probably shout the judge saw something that convinced her 13D had a solid argument, I however see it different. In my opinion, the judge simply could not understand fully the answers by 13D and decided to err on the side of caution by moving forward.
To prove my hypothesis, let's break down two of the 13D answers. Why two? Because while being pages apart, they are interrelated questions and answers.
From Page 11
THE SIDLEY CLAIM:
...Dr. Patterson claims that 596,242 shares of (Cytodyn) are held beneficially by Incelldx...
The claim says Dr. Patterson in one place says he owns all those shares himself but in another place says it is Incelldx that owns the shares which means the shares are only partially owned by BP.
13D RESPONSE:
... Dr. Patterson is the beneficial owner of 596,242 shares of common stock of (Cytodyn). Dr. Patterson has requested that (Cytodyn) re-register these shares in the name of Incelldx. To Dr. Patterson knowledge this has not been done and the shares remain registered in Dr. Patterson name. Due to the above, Dr. Patterson disclaims beneficial ownership of 596,242 shares...
HUH? WHAT? Can someone "DISCLAIM" ownership of their shares? What the hell does this even mean? (Keep this answer in mind. We will come back to it)
On page 14, we get a related claim and response.
THE SIDLEY CLAIM.
C3) Mr. Beatty response to C1 fails to list the stock options that he indirectly owns through Incelldx's ownership of such options.
THE 13D RESPONSE:
The stock options are not owned by Incelldx. They are registered in the name of Dr. Patterson and he has agreed to register them in the name of Incelldx, when possible. Dr. Patterson has requested that (Cytodyn) release and re-register the shares but (Cytodyn) has not done so and claims they were never granted to Dr. Patterson and his inclusion in (Cytodyn) form S-3.... was erroneous despite not being amended or corrected...
OK, RAISE YOUR HAND IF YOU UNDERSTOOD ALL THAT?
Now let's analyze what they appear to be saying. We will start with the second claim and response.
The claim is simple and straightforward. Mr. Beatty owns a large portion of Incelldx. Incelldx owns 596,242 shares, therefore, Mr. Beatty indirectly owns Cytodyn through his ownership of Incelldx and failed to mention this in the filing.
The first sentence of the 13D answer appears to be a perfect response.
"The stock options are not owned by Incelldx!"
Hey, booyah, case closed. (KEEP THIS ANSWER IN MIND. WE ARE COMING BACK TO IT.) Except it's not. The 13D attorneys felt compelled to clarify the position.
"They are registered in the name of Dr. Patterson and he has agreed to register them in the name of Incelldx when possible."
Wait, what??? Let's analyze that. Notice the change in wording. Incelldx does not OWN shares but referring to Patterson, the shares are REGISTERED. Notice they don't claim the shares are OWNED by Patterson.
Because they aren't. After all the next thing they say is Patterson has agreed to register them in the name of Incelldx.
Why would he do that??? Duh, because they are owned by Incelldx.
The next sentence states Patterson has requested he re-register the shares but Cytodyn has refused (notice the positive/negative reinforcement -- BP is "trying" to do what is right while Cytodyn won't let him) because (Cytodyn) "...claims they were never owned by Patterson and his inclusion... was erroneous.
Okay, basically, there was a clerical error. A typo when filing an S-3. And Patterson was registered in error.
Patterson wants to re-register (basically correct the typo) but Cytodyn claims just because there is a typo, the ownership of the shares didn't change. Therefore, Patterson never owned them, and he can't do anything with shares he never owned.
Remember the answer to the first Sidley claim? BP said he DISCLAIMS ownership of the 596,242 shares. Well, of course, he never owned them, duh!
Which all leads to only one conclusion. Regardless of this typo involving Patterson, the shares were and always have been owned by Incelldx.
Finally, this brings us back to that very first sentence in the answer:
"The stock options are not owned by Incelldx"
BUUUZZZZZZ! INCORRECT!
Now you see why they had to clarify their statement.
Which finally brings us full circle to the Sidley claim. Mr. Beatty owns part of Incelldx which owns 596,242 shares of Cytodyn so Mr. Beatty indirectly owns Cytodyn shares.
Ding, ding, ding, the Sidley claim is correct!!!
Now do you think the judge did all this mental gymnastics? No, she just decided she can't make heads or tails of it and needs to hear direct testimony where she can sort it all out through questioning.
LAWYERS ARE UNDER OATH!!!
Whenever an attorney supplies paperwork to the court they attest that the information contained therein is correct and true to their best belief. An attorney risks their license if they purposefully lie in court documents.
Of course Belief leaves a crack in the door. An attorney could always claim something that turns out to be untrue by accident. But some things don't leave as large a crack.
Sidley has made a claim that Incelldx owns 596,242 shares of common stock in Cytodyn. They didn't pull that number from the Aether. You can wager your bottom dollar they saw the proof and firmly believe in it's veracity and are ready to prove it.
Meanwhile, the 13D answer basically lies, but then clarifies the position with the full truth. The 13D attorney certainly understood what they were writing. They were making very certain there erroneous claims didn't come back to bite them.
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