Pomerantz Achieves $3 Million Settlement with 22nd Century Group

Pomerantz recently achieved a $3 million settlement with the agricultural biotechnology company 22nd Century Group, Inc. The investor suit alleged, among other things, that the company concealed an SEC investigation into its accounting controls.

22nd Century Group is a biotechnology company based in Buffalo, New York that engineers tobacco plants to alter the level of nicotine they contain, as well as engineers cannabis plants to reduce their level of cannabinoids. According to the complaint, at some point before 2016 the SEC commenced an investigation into supposed material weaknesses in the company’s internal accounting controls. However, in a series of statements in 2016 and 2017, 22nd Century Group failed to disclose this investigation. In 2018, a user writing under the name “Fuzzy Panda” published an article on the financial news website “Seeking Alpha” revealing the existence of the SEC investigation. The suit alleged that the company’s failure to disclose the SEC investigation rendered several of its previous statements materially misleading.

Pomerantz’s litigation team was led by Managing Partner Jeremy A. Lieberman and Partner Brian Calandra. Commenting on the news of the settlement, Calandra said, "We are happy that Judge Roemer recognized the value that the settlement obtained for investors and are very pleased to be close to distributing settlement proceeds to investors."