Yangtze River Port and Logistics Ltd (OTCMKTS: YRIV) has been an interesting stock to follow. After a late-2018 Hindenburg Research Report made serious allegations about the company and its leadership, the stock has given up billions of dollars in value, now trading with a market cap of around $80 million.
Recently, the stock was delisted from the NASDAQ and investors have been getting ancy. So, what’s the deal? Here’s the latest update:
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YRIV Provides Update Surrounding Hindenburg Research Litigation
Yesterday, Yangtze River Port and Logistics issued a press release providing an update with regard to its litigation against Hindenburg Research and its collaborators. The case names Hindenburg Research, Nathan Anderson, ClaritySpring Securities LLC and ClaritySpring Inc. as defendants.
According to YRIV, these defendants coordinated and orchestrated a market manipulation scheme to disseminate false, misleading, and defamatory content to the marketplace for the purpose of inflicting substantial reputational harm on the company for their own financial gain.
In the update, the company said that it established a Special Committee for Internal Investigation. The Committee, led by independent director, Mr. Zhixue Su reviewed claims, including the relevant financial records, public documents, lease agreements, and court documents of the Company’s Wuhan subsidiary.
Upon the end of this investigation, the company and its Committee concluded that the report was completely false, leading to the lawsuit being filed. When filing the complaint, YRIV systemically refuted the errors contiained in the report, providing evidence from its own investigation.
At the moment, Yangtze River and the defendants are in the midst of litigation in the Supreme Court of New York. Currently, we’re awaiting oral arguments on October 7, 2019 surrounding the defendants’ Motion to Dismiss Complaint.
Oral arguments were originally scheduled for August 14, 2019, but the Court adjourned the hearing until October 7, 2019.
So, What Does All Of This Mean
Since I started following the story, I’ve been largely on the side of YRIV. Unfortunately, we see short and distort schemes quite often. However, these schemes very rarely make it to the courtroom as the effects they tend to have on the market are short term.
In this case, the pain is still being felt. Nonetheless, I stand by my argument that if the company and its executives were “siphoning money” from US investors, they wouldn’t expose themselves to the investigations that would come as part of litigation.
Nonetheless, all we know at the moment is that the defendants in the case filed a Motion with the hopes of case dismissal. Given everything surrounding the case thus far, I don’t believe that dismissal is likely, but we’ll find out more in early October.
What To Do With The OTC Shares
I am not an investment advisor and cannot tell you to sell, hold, or buy more YRIV stock. I’ve received several questions about OTC stock and how to sell it. Many are worried that they are locked into these OTC shares. Nonetheless, that’s not necessarilly true.
OTC shares are traded on the market every day. Some OTC stocks even trade with pretty high volume. All you need to do is open a brokerage account, deposit your shares, and do what you will with them from there. Here are some details on buying and selling OTC shares.
What We’ll Be Watching For
At the moment, the YRIV case is at a standstill. Nonetheless, we’ll be keeping our eyes peeled in October for updates in the case. Should the case go well, we could see tremendous growth in the value of the stock ahead.
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