Clarus Corp. reported it sees the potential recovery of $46.2 million related to a lawsuit it filed against HAP Trading, LLC and Harsh A. Padia regarding the recovery of short-swing profits in violation of securities laws.
On November 20, Clarus submitted a report experts calculated in the recovery that could be available to Clarus from HAP Trading’s purchases and sales of Clarus common stock in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended.
Clarus engaged Charles Lundelius, a managing director with Berkeley Research Group, to conduct a comprehensive review of HAP Trading’s transactions in shares of Clarus’ common stock from July 19, 2022 to September 23, 2022 to seek to disgorge profits from transactions in Clarus’ common stock and related derivative securities. Lundelius’ report determined a potential recovery of $46,157,732.
Clarus said rebuttal reports from HAP Trading’s expert are due by December 22, 2023, and thereafter, other court-mandated timelines, including the deadline for expert discovery on January 19, 2024 and a joint status letter to the court on January 26, 2024.
HAP Trading also submitted expert reports claiming market-making and arbitrage exemptions from Section 16(b) requirements, which Clarus and Lundelius have concluded are not applicable in the current context; however, there can be no assurance that Clarus will recover all or any of the amount indicated in the Lundelius report.
Clarus said, “Clarus believes that each of Caption Management, LLC and Parallax Master Fund, L.P. may also have violated Section 16(b), and is continuing its investigation on potential claims against them.”
Clarus’ brands include Black Diamond, Rhino-Rack, Maxtrax, Sierra, and Barnes.
Photo courtesy Reuters
