AP: Purported Idaho nuke plant developer to pay $450K to settle with angry investors
The head of a company seeking to build a nuclear power plant in Idaho has agreed to pay $450,000 to resolve a lawsuit with a group of angry investors, reports AP reporter Alex Morrell. Shareholders of Alternate Energy Holdings Inc. in late 2010 sued the company, Chief Executive Officer Don Gillispie and Vice President Jennifer Ransom, claiming they schemed to mislead investors about their compensation and manipulated the company's trading value; a Boise lawyer representing the investors said an agreement was reached in mediation last week, calling on the company to pay $450,000 by the end of June or face a $2 million penalty judgment. A federal judge must still approve the settlement; click below for Morrell's full report.
Settlement reached in nuclear project lawsuit
By ALEX MORRELL, Associated Press
BOISE, Idaho (AP) — The head of a company seeking to build a nuclear power plant in Idaho has agreed to pay $450,000 to resolve a lawsuit with a group of angry investors.
Shareholders of Alternate Energy Holdings Inc. in late 2010 sued the company, Chief Executive Officer Don Gillispie and Vice President Jennifer Ransom, claiming they schemed to mislead investors about their compensation and manipulated the company's trading value.
Philip Gordon, a Boise lawyer representing the investors, said an agreement was reached in mediation last week, calling on the company to pay $450,000 by the end of June or face a $2 million penalty judgment.
A federal judge must still approve the settlement.
Investors say that between 2006 and 2010, Gillispie duped them into buying Alternate Energy stock at an artificially inflated price by hiring stock promoters to manipulate demand for the company and then issuing deceptive press releases touting the company's fiscal health.
"Alternate Energy and certain of its officers and directors made materially false and misleading statements and engaged in a scheme to manipulate and artificially inflate the market price," the shareholders' lawyers wrote in the complaint.
They also allege that while Gillispie was working to swell the stock price, he and Ransom were secretly unloading their own shares for a profit.
Gillispie denies any wrongdoing.
Accusations of fraud against the company were first made public when the Securities and Exchange Commission filed a lawsuit in December 2010.
Among the allegations, SEC attorneys claim company executives conspired to falsely state in marketing promotions that the project was "fully funded"; Ransom hid $675,000 in stock sales; Ransom and Gillispie misled shareholders about their pay; and double-dipped to recoup $145,000 in personal expenses, including stays at Las Vegas' Bellagio Hotel & Casino.
The SEC's allegations sent the company's stock price plummeting from 58 cents per share to as low as 6 cents per share, causing significant losses for shareholders, who sued the company days later.
For the past decade, Alternate Energy Holdings has sought to build a nuclear power plant in three Idaho counties, switching locations several times.
Richard Roth, Gillispie's lawyer, said the agreement removes a time-consuming and expensive obstacle, allowing the company to move forward.
"In light of the fact that this lawsuit alleged millions of dollars in damage, we're very pleased with the result," Roth said.
The company received clearance last summer from Payette County to build a nuclear power plant.
Copyright 2012 The Associated Press.
