New York AG Petitions Kodak CEO To Testify On His Stock Buys After Secret $655M Loan Deal With Trump

Via press release from New York AG Letitia James:

New York Attorney General Letitia James, today, announced a new action taken in her investigation of insider trading by the chief executive officer (CEO) of the Eastman Kodak Company (Kodak).

Attorney General James filed a petition with the New York County State Supreme Court to have Kodak CEO Jim Continenza publicly testify about his purchase of more than 46,000 shares of Kodak stock early last summer and Kodak’s subsequent false statements about that trading to investors last month.

Continenza’s stock purchase occurred in the midst of the coronavirus disease 2019 (COVID-19) public health crisis last June, as the pandemic exposed domestic shortages in the chemical building blocks used to make medicines.

Continenza made the purchase while he was leading secret discussions with the Trump White House and the federal government for a $655 million loan to enable Kodak to repurpose legacy assets in Rochester to produce chemicals to address this need.

Attorney General James’ petition also asks the court to order public testimony from Kodak’s general counsel, as well as for the company to produce related documents.

Attorney General James’ petition shows that, on June 23, 2020, Continenza bought 46,737 shares of Kodak stock at a weighted average price of $2.22 per share.

Just over a month after Continenza’s stock purchase, Kodak signed a public letter of interest with the federal government for the loan — which by then had grown to $765 million — causing Kodak stock to soar.

The day after the news was announced, Kodak’s stock price reached a high of $60 per share — more than 27 times what Continenza had paid for the stock mere weeks earlier.