First, he dismissed a class-action lawsuit against Top Ships. Then he delivered the same victory to the former DryShips.
Now, a US federal judge has asked why he should not also throw out a lawsuit against the former Diana Containerships over financing from Marc Bistricer-backed Kalani Investments.
The order by district judge Brian Cogan threatens to close the book on three lawsuits filed in connection with Kalani’s deals to provide financing for US-listed shipping companies.
Investors filed the lawsuit in 2017 alleging that Diana Containerships, led by Simeon Palios at the time and before it became Performance Shipping, engaged in a manipulative series of transactions with Kalani that pushed down the value of the shares.
According to the lawsuits, Diana Containerships issued shares at a discount to Kalani, which then sold them in the market.
When the share price fell below the levels required for a US listing, Diana Containerships carried out reverse stock splits.
As in the other two cases involving Kalani deals, Diana Containerships asserted that the deals were disclosed to investors.
Kalani was backed by Murchinson, a Toronto hedge fund led by Bistricer, and all three are defendants in the case.
Cogan proposed dismissing the case in a one-sentence order written directly on the docket at the US District Court for the Eastern District of New York.
The judge asked why, given his dismissal of a similar lawsuit against George Economou’s DryShips, he should not do the same in the Diana Containerships case.
Lawyers for the shareholders suing the plaintiffs did not immediately respond to TradeWinds’ request for comment on the order.
In October, Cogan threw out a lawsuit against Economou and his former company, as well as Bistricer and his companies.
He wrote that the timing of DryShips’ reverse stock splits did not demonstrate an intent to manipulate but represented an attempt to prevent delisting.
The judge said the lawyers for suing shareholders did not show that the DryShips case was different from the lawsuit against Top Ships that he had already dismissed.
“Plaintiff’s attempt to distinguish the two cases is unconvincing,” he wrote in the October order.
Cogan dismissed the lawsuit targeting Evangelos Pistiolis-led Top Ships and Bistricer’s companies in 2019.
He concluded that there was no market manipulation in the Kalani deals because their details were disclosed publicly.
And the judge rejected claims of misstatements and omissions.
An appeal court upheld his decision.
