Hemispherx Biopharma prevails in multimillion dollar federal lawsuit

All claims by Cato Capital were dismissed by a federal judge; company seeks $1-million award for fees and costs against losing party

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PHILADELPHIA--Hemispherx Biopharma, Inc., has announced that a federal judge in Delaware has dismissed all claims against Hemispherx and the Sage Group brought by Cato Capital in an order and decision dated September 29, 2014. The decision comes following a three day trial before a judge in the United States District Court for the District of Delaware, which considered several multimillion dollar claims brought by Cato Capital. The Court's order completely vindicated Hemispherx and the Sage Group of any wrongdoing and denied Cato Capital's claims against Hemispherx for breach of contract and fraudulent inducement. On October 14, 2014, Hemispherx' lead trial counsel James J. Black, filed a motion for recovery of fees and costs seeking recovery for Hemispherx of approximately one million dollars based upon contractual fee shifting provisions in the subject contract.

"A similarly meritless multimillion dollar case against Hemispherx was taken to a federal jury trial in Atlanta (http://www.hemispherx.net/content/investor/default.asp?goto=775 ) earlier this year," observed Thomas K. Equels, Hemispherx' general counsel. "After more than a week in trial, the federal jury needed just one hour to determine that the Atlanta case against Hemispherx was without merit. Now a federal judge has reached the very same conclusion in litigation brought against Hemispherx by Cato Capital in Delaware. Simply put, our company will aggressively defend meritless litigation and pursue the losing party to recover fees and costs to the fullest extent allowed by law." A cost judgment was obtained against the plaintiff in the Atlanta case.

Recently, in an effort to deter and shift the costs of meritless litigation, the board of directors of Hemispherx enacted a fee shifting bylaw allowing the Company to recover fees and costs against stockholders who bring meritless claims against Hemispherx.

Hemispherx Biopharma, Inc. is an advanced specialty pharmaceutical company engaged in the manufacture and clinical development of new drug entities for treatment of seriously debilitating disorders. Hemispherx's flagship products include Alferon N Injection® and the experimental therapeutics Ampligen® and Alferon® LDO. Ampligen® is an experimental RNA nucleic acid being developed for globally important debilitating diseases and disorders of the immune system, including Chronic Fatigue Syndrome.
 
Hemispherx's platform technology includes components for potential treatment of various severely debilitating and life-threatening diseases. Because both Ampligen and Alferon LDO are experimental in nature, they are not designated safe and effective by a regulatory authority for general use and are legally available only through clinical trials. Hemispherx has patents comprising its core intellectual property estate and a fully commercialized product (Alferon N Injection), approved for sale in the U.S. and Argentina. The company's Alferon N approval in Argentina includes the use of Alferon N Injection (under the brand name "Naturaferon") for use in any patients who fail or become intolerant to recombinant interferon, including patients with chronic active hepatitis C infection. The company wholly owns and exclusively operates a GMP certified manufacturing facility in the United States for commercial products.
 
On Sept. 29, Hemispherix announced five integrated Ebola-based collaborations with: 1) National Institutes of Allergy and Infectious Disease (NIAID), a branch of the National Institutes of Health (NIH); 2) the United States Army Research Institute in Infectious Disease (USAMRIID); 3) the Swiss Department of Defense (Spiez Lab); 4) research being conducted at Howard University, Washington, DC; and 5) a U.S.- based facility with biosafety level 4 (BSL-4) capabilities with whom a Sponsor Research Agreement is currently being negotiated. Two earlier Ebola research collaborations were recently announced with USAMRIID on Sept. 8, 2014 and the Swiss Department of Defense on Sept. 10, 2014


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