CALGARY -- American short-seller Marc Cohodes is firing back at the Alberta Securities Commission after it announced it wants to stop him from trading in securities of Calgary-based Badger Daylighting Ltd.
Law firm Boersch Shapiro, which says it represents Cohodes in the United States, says in a statement the investor will challenge the ASC's "ill-advised application" and looks forward to "public revelations" about Badger.
The provincial regulator said Thursday it will also seek to have the California short-seller prohibited from making "misleading" public declarations regarding Badger, citing a social media posting that used a picture of a Badger truck as support for his allegation of illegal toxic dumping.
But the law firm says Cohodes has evidence from whistleblowers that supports his allegation of illegal dumping of toxic material by the hydrovac excavating company and accuses ASC staff of not contacting him to review the evidence.
In May, Badger said in a news release that the ASC had conducted an investigation into allegations made against it by short-sellers and found that no enforcement action would be taken.
The Boersch Shapiro statement says the ASC's requested order would purport to violate the U.S. Constitution and Canadian Charter of Rights and Freedoms by restraining Cohodes' right to free speech.
In its notice of application, the ASC accuses Cohodes of trying to artificially manipulate the price of Badger securities, thus becoming a "threat" to the integrity of the capital market in Alberta.
The application for the order against Cohodes is to be heard next week.