Court gives Daniel Yu and Gotham 21 days to respond to Grifols’ lawsuit | Economy

The judicial machine is working. The New York court in which Grifols sued bearish investor Daniel Yu and his firm Gotham City Research has issued subpoenas to the defendants, legal sources said. They provide a 21-day period to appear and respond to the claim, but with one caveat: the period begins the day after notice of the summons. This is usually…

The judicial machine is working. The New York court in which Grifols sued bearish investor Daniel Yu and his firm Gotham City Research has issued subpoenas to the defendants, legal sources said. They provide a 21-day period to appear and respond to the claim, but with one caveat: the period begins the day after notice of the summons. What’s usually a no-brainer makes a little more sense in this case: Yu is missing, and Gotham headquarters is also missing.

The court clerk issued four subpoenas against the people Grifols sued. First up is investor Daniel Yu. The suit describes him as a felon with a “stained” criminal record and reportedly changes his address frequently. It is also stated that, according to available information, he lives in Manhattan. The truth, however, is that it is unclear where his address is. The subpoena issued against him states that his “address has not yet been determined despite reasonable efforts” to locate it.

“Within 21 days from the date of service of this summons (not counting the day it is received),” the summons states, “you must serve on the plaintiff an answer to the attached complaint or process” thereunder. “If you do not respond, a default judgment will be entered against you for the damages sought in the complaint. You must also submit your answer or motion to the court,” the court clerk’s letter states.

Identical subpoenas are addressed to Gotham, whose address is also unknown, and to Cyrus De Weck, an ally of Daniel Yu who runs the firm General Industrial Partners, LLP (GIP), an investment fund taking bearish positions to benefit from the decline quote, based on which Gotham reports are published. There is a fourth challenge against General Industrial Partners itself, which in this case relates to its London address.

The Spanish company accuses the bearish investor and his allies of defamation, business interference and unjust enrichment, according to a 78-page lawsuit filed in New York courts, which EL PAÍS had access to. Grifols demands a jury trial, tries to refute Gotham’s thesis, highlights the lies he included in his first report, and demands compensation. Additionally, he claims that Yu is a convicted criminal and describes some of his illegal activities. The company has expressed concern that some banks will not refinance its debt or demand higher interest rates as a result of the bearish attack. And he warns that the report has prompted 13 law firms to prepare class action lawsuits against Grifols in the United States.

Grifols has hired the law firm Proskauer Rose LLP. The lawsuit seeks damages to be determined at trial; compensation for benefits unfairly received by defendants; punitive damages in an amount “sufficient to deter further illegal and unlawful conduct”; costs and expenses incurred in connection with the litigation, including attorneys’ fees and interest at the maximum legal rate allowed by the court. At the same time, Grifols is asking for “any other remedy that the court deems fair and appropriate,” according to the text of the lawsuit.

Grifols shares rose 4.3% on the stock market on Monday after the contents of the lawsuit and the arguments it uses in its defense became known. The price closed at €9.97 per share. Despite this, it is still well below the 14.24 euro level of January 8, the session before the publication of the report in which Gotham claimed that its shares had no value. On the day the report was published, the price fell by more than 40%.

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