Alliance MMA was sued last week, and the organization recently issued a response to the lawsuit.
Last week, an Alliance MMA shareholder filed a class-action lawsuit against the publicly-traded mixed martial arts company in United States District Court for the District of New Jersey for federal securities law violations.
Alliance MMA became available on the NASDAQ stock exchange last October at an IPO-offering price of $4.50 USD per share. Alliance MMA is sitting at $1.53 USD as of this writing, which is a major decline from just months ago.
The plaintiff, Eric Shapiro, claimed in the suit that he suffered a significant loss due to “wrongful acts and omissions” from the defendants, CEO Paul K. Danner, III and CFO John Price.
Alliance MMA has since responded to the lawsuit — and it plans on fighting back.
“The Company believes that the lawsuit is without merit and intends to vigorously defend against it,” a recent press release read.
“Securities claims like this are often pursued by opportunistic lawyers when there is a drop in stock price,” Danner said. “The law firm of King & Spalding LLP has been engaged to help us fight back, and we plan to file a motion to dismiss this lawsuit.”
Alliance MMA was founded in 2015 “for the purpose of acquiring businesses that engage in the promotion of mixed martial arts,” per a description in a press release. Alliance MMA has since acquired many regional organizations and its intent is to act as a feeder promotion for the UFC.