Laidlaw & Company is an investment banking institution that also provides wealth management services for US and UK clients. On December 10, 2015, an injunction was filed against the institution and its principals – Matthew Eitner and James Ahern by Remalda Therapeutics Inc. Remalda is a company that works on developing chronic pain treatments. The injunction filed with the District Court of Nevada was to prevent Laidlaw from distributing proxy materials that provided misleading information about Remalda. The CEO of Remalda, Sergio Traversa said that he was “pleased with the decision to grant a temporary restraining order and associated injunction.” He emphasized the commitment of the Remalda Board to guarantee the interests of stockholders, which is more than can be said for Laidlaw.
A Look at Laidlaw
The investment banking company offers an advantage seeing as it offers a full-service package. Services on strategic patterning transactions, balance sheet optimization, fairness opinions, acquisition advisory services, and management-led buyouts are just a few that would pique the interests of individuals and corporations. However, the complaints lodged against the institution are hard to ignore. Of course, I understand that it is virtually impossible for an investment banking firm to work without a few disgruntled clients, but Laidlaw seems to have a real problem.
Take for example the case of Remalda where Laidlaw used confidential information to run a contest that would grant it effective control of the pharmaceutical company. Such disregard for the fiduciary duty to a client is unacceptable. Besides that, I learned that one of their brokers, Leonard V Gallick Jr., has had seven complaints in different institutions according to his BrokerCheck report. In 2013, one complaint against Gallick Jr. while he was at Laidlaw settled for $350,000. The violation of U.S financial regulations is not new for Laidlaw; as a matter of fact, they have a long history of it. It is baffling how an institution that has been operating for such a long time can still be making some of the most common fiduciary mistakes. I think that Laidlaw should reevaluate its management and implement stricter measures for brokers if it’s to maintain a strong footing in the industry.