Pomerantz LLP announces that a class action lawsuit has been filed against Top Ships Inc. ("Top Ships" or the "Company") and certain of its officers. The class action, filed in United States District Court, Eastern District of New York, and docketed under 17-cv-05016, is on behalf of a class consisting of investors who purchased or otherwise acquired Top Ships securities, seeking to recover compensable damages caused by defendants' violations of the Securities Exchange Act of 1934.
Top Ships is an international provider of oil, petroleum products and chemicals transportation services.
The complaint alleges that throughout the Class Period, defendants made materially false and misleading statements regarding the Company's business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that the Company's CEO, Evangelos J. Pistiolis ("Pistiolis"), through his control of Top Ships, caused Top Ships to engage in a series of manipulative share issuance/sales transactions with Kalani Investments Limited and certain of its related entities ("Kalani") through which Top Ships would sell its common shares and securities convertible into common shares to Kalani at a significant discount to market price and file registration statements so that Kalani could resell these shares into the market. When Kalani's sales of Top Ships stock caused the price of Top Ships stock to decline, the Company would reverse split the stock, causing a certain number of outstanding shares to be merged into a single share, and thereby raise the price of Top Ships stock. Then, Top Ships would again sell securities to Kalani and the same pattern of transactions would ensue. At the same time that Top Ships was engaging in these transactions, defendants failed to disclose the true purpose of the transactions and related stock issuances and reverses – to finance related-party transactions and acquisitions that primarily benefited Pistiolis and his related companies, and otherwise funnel money to Company insiders.
By August 2017, Top Ships, through Kalani, had issued and sold into the market tens of millions of shares of its common stock, vastly diluting the Company's existing shareholders. While Top Ships has allegedly used the proceeds from these offerings to further enrich Pistiolis and his affiliates through various related-party transactions, the value of Top Ships common stock has dropped over 99%.