Former Amaya CEO David Baazov will have to pay $1.8 million to settle a class action that claimed he employed a stock market manipulation scheme.
A Quebec investor wishing for six years to obtain authorization from the courts to initiate a class action against David Baazov sees the case conclude with a settlement agreement.
The investor claimed that David Baazov made him lose money in connection with his failed attempt to buy the company that had just purchased the PokerStars site.
The heart of the matter dates back to 2016. In February of that year, David Baazov published a document in which he announced his intention to submit an acquisition offer for all of Amaya’s shares.
The value of Amaya’s stock jumped 17% following this announcement. In November 2016, David Baazov published a second document in which he announced that he had presented a formal offer for all of Amaya’s shares at a unit price of $24.
After the publication of this news, the value of Amaya shares increased by 12% on the stock market.
David Baazov later admitted that he had not obtained the financing required to complete the acquisition.
A notice published Wednesday indicates that David Baazov will pay $1.8 million “without admission of liability” to free himself from the claims or allegations made against him.
“Defendant has denied and continues to deny all claims and allegations of wrongdoing made by Plaintiff,” the notice states.
The settlement amount to be shared among investors will be reduced by 30%, or $540,000 plus disbursements and taxes, to cover attorneys’ fees and other expenses.
The settlement is aimed at those who acquired securities of Amaya (now known as The Stars Group) between 1er February 2016 and November 21, 2016, and who held part or all of these securities until November 22, 2016.
It was Judge Sylvain Lussier, of the Superior Court, who approved the settlement three weeks ago.
It was not immediately possible to obtain a reaction from David Baazov.
In the years following Amaya’s acquisition of PokerStars in 2014, the Financial Markets Authority (AMF) tried in vain to convict David Baazov by accusing him of insider trading.
He was suspected by the AMF of being the source of a “major leak of inside information” which led to a series of insider dealings linked to acquisition projects in preparation.
David Baazov’s trial aborted in 2018 after a judge of the Court of Quebec ordered a halt to the legal process by criticizing the AMF’s work surrounding its management of evidence.