Company sues over Net postings
A small Daniel Island company that says its reputation has been tarred by anonymous remarks posted on the Internet filed a libel lawsuit Monday against one of the alleged commentators.
Revolutions Medical Corp. said Philip Maurice "Marty" Hicks used the alias "tazmanian353" on two online message boards to wage "a cyber smear campaign in an effort to destroy" the company and its management.
The complaint, which was filed in Charleston County Court of Common Pleas, seeks unspecified damages and a court order to remove the messages and prevent Hicks from making more defamatory statements about the company.
Last week, Revolutions Medical officials said it was under attack by contrarian investors known as "shorts" or "shorters," who make money when stock prices fall.
The complaint alleged that tazmanian353 falsely accused Ron Wheet, the company's chief executive officer, and Thomas O'Brien, its president, of violating securities law in a number of online postings on message boards operated by Yahoo!Finance.com and RagingBull.com.
The lawsuit also said Hicks falsely accuses Wheet and O'Brien of fraud, assault, identity theft, racketeering and theft of intellectual property, among other crimes, in order to advance an elaborate "pump and dump" stock scheme.
In a written statement Monday, Wheet said "the shorters need to recognize that when a line is crossed the company will take appropriate action." He declined to comment further.
Revolutions Medical did not say how it identified Hicks as tazmanian353.
Hicks is listed on Bridge CFO LLC's website as a certified public accountant and part of the senior management team of the firm, which says it has offices on Daniel Island and in Mount Pleasant. He could not be reached for comment Monday.
Shares of Revolutions Medical, which are not traded on a major stock exchange, soared from 27 cents on Aug. 20 to a 52-week peak of $1.74 early last week according to Yahoo!Finance.
The jump coincided with a flurry of statements the company released about potentially promising business prospects. The announcements have included a five-year deal with a company to make a retractable syringe that Revolutions Medical has developed. It also has said it expects to receive a contract to sell its disposable needles to a program run by the U.S. Department of Defense.
The resulting rise in the stock price increase triggered a flood of online comments on financial message boards about the company.
Wheet told The Post and Courier last week that many of the disparaging remarks were likely generated by short investors, who look to profit by selling borrowed shares in the hopes of repurchasing them later at a lower price. He said their motivation is to drive down the stock price to cover their bets.
Shares of Revolutions Medical skidded 25 percent Monday to close at 68 1/2 cents.
Reach John McDermott at 937-5572.