Hemispherx says court awarded it $188M in lawsuit against JCI for fraudulent takeover attempt

Hemispherx says it was awarded $188M in lawsuit

PHILADELPHIA — Hemispherx Biopharma has been awarded a $188 million judgment against a South African investment firm that tried to take over the company using false information.

The damages were assessed this month by a U.S. District Court Judge James King, who ruled against Johannesburg Consolidated Investments and two of its former executives, Hennie Buidentag and the late Brett Kebble, Hemispherx said Wednesday.

Bioclones Ltd., a biotechnology interest controlled by Johannesburg Consolidated, proposed a merger with Hemispherx in 2002, the company said. It says Bioclones misrepresented its regulatory experience, financial status and interests in an attempt to get access to confidential information and deceive Hemispherx into agreeing to the deal. The company claimed JCI actually intended “to take over and pillage Hemispherx.”

Hemispherx filed suit against JCI in 2004. It said JCI lost the case, but has ignored court orders. The company said it is committed to trying to collect the judgment from JCI but does not know if it will be able to do so.

JCI maintains it did not cause damages to Hemispherx, and said it told its attorneys in the U.S. to withdraw from the case earlier this year on advice from legal counsel. JCI said the South African courts will not enforce a judgment against the company in the U.S. because JCI never had any U.S. offices and never did business in the country.

Brett Kebble was shot to death in 2005 after his financial dealings came under scrutiny. South African authorities now believe Kebble orchestrated the shooting, based in the testimony of state witnesses who said they were involved during a high-profile court case.

Hemispherx stock jumped 9 cents to 57 cents in morning trading.