Facts

ParmaCielo Ltd., through its subsidiary, PharmaCielo Colombia Holdings S.A.S., cultivates, processes and supplies all-natural medicine-grade cannabis oil extracts to large channel distributors via its greenhouse facilities in Colombia.

PharmaCielo Investor Group brought a class action against ParmaCielo; Chief Executive Officer David Attard; Chief Financial Officer Scott Laitinen; Chief Corporate Officer David Gordon; and Chief Operating Officer Andres Botero. The class included all persons who acquired PharmaCielo securities publicly traded on the OTCQX during the class period, and who were damaged thereby.

PLAINTIFF'S CONTENTIONS: Plaintiff contended that defendants made false and/or misleading statements by misrepresenting and failing to disclose adverse facts pertaining to the company's business, operations and prospects, which were known to defendants or recklessly disregarded by them. Among other things, defendants engaged in a material transaction with a related party, without disclosing that relationship to investors. Defendants also significantly overstated the efficacy and competitiveness of the company's business and operations in South America. Moreover, in touting its operations and efforts to expand, defendants misrepresented and failed to disclose that PharmaCielo faced significant delays in the construction of its research technology and processing centre; that one of its facilities was located on a floodplain that was contaminated with mold and pesticides from its previous tenants; and that the company's only other real property had never been utilized and remained idle. As a result of defendants' conduct, plaintiff purchased the company's securities at artificially inflated prices during the class period and was damaged upon the revelation of the alleged corrective disclosure.

DEFENDANTS' CONTENTIONS: Defendants denied all contentions.

Result

The defendants' motion to dismiss was granted with prejudice.