Navidea Biopharmaceuticals Inc. (NYSEMKT: NAVB) suffered a major setback in its dispute with lender CRG after a judge in Texas ruled that the company should surrender its bank accounts to the lender within a few weeks. However, the management of Navidea has vowed to continue the fight to retain the control of the company’s financial accounts.
Given the point that the case has reached, the option for Navidea Biopharmaceuticals Inc. (NYSEMKT: NAVB) is to appeal the judge’s ruling and that is what the caretaker COO, Jed Latkin, said they will do. Latkin added that there are still plenty of options for NAVB with regards to the dispute.
21 days to comply
The ruling by the judge in Texas requires Navidea to turn over the control of its financial accounts to CRG within 21 days. The first 14 days will be for the company to surrender information relating to the accounts to CRG. After that the company will have one more week to enter agreements that will see CRG take control of the accounts.
However, CRG wanted the process to happen faster. The lender asked Judge Mike Engelhart to only allow Navidea a 7-day deadline to finish the process of turning over the accounts, but the judge rejected that request, instead allowing Navidea a wide room of 21 days.
Despite the judge’s ruling, Navidea Biopharmaceuticals Inc. (NYSEMKT: NAVB) isn’t prepared to let go of its financial accounts. Instead, the company will be seeking to overturn the ruling through an appeal process.
Loan default – Navidea Biopharmaceuticals Inc (NYSEMKT: NAVB)
The dispute between Navidea and CRG that has brought up the issue of accounts seizer stems from a $52 million loan. CRG is claiming that Navidea has defaulted on the loan after remaking its board and parting with its CEO. The lender sued Navidea for defaulting on its loan, but Navidea countersued, thus paving the way for the legal battle.
The latest development marks the second time that a judge has given CRG the green light to seize Navidea Biopharmaceuticals Inc (NYSEMKT: NAVB)’s financial accounts. In the first instance, the judge ruled that CRG can take over Navidea’s main account with $4 million in it. But Navidea moved quickly to open a new account and that ensured that it remained in operations.
Though Navidea is focused on appealing the latest ruling, it remains in talks with potential investors and partners to see how it can replace CRG’s controversial loan.