According to the law firm press release, Paulson Capital Corp. ("PCC") was once a publicly traded financial services holding company that operated through its sole subsidiary Paulson Investment Company ("PIC").

According to the lawsuit, PCC issued materially false and misleading information to investors. On October 18, 2013, the Company filed a Definitive Proxy Statement on Schedule 14A (the "October Proxy Statement) with the U.S. Securities and Exchange Commission (the "SEC") and solicited votes from shareholders necessary to approve a certain restructuring transaction (the "Restructuring Transaction"). Among other things, the October Proxy Statement asked PCC shareholders who held shares as of October 11, 2013 ("Legacy Shareholders") to vote on a transaction that would, among other things, spin off certain legacy assets of PCC and PIC into a Liquidating Trust for the benefit of Legacy Shareholders. The October Proxy Statement set October 11, 2013 as the Record Date for a shareholder meeting that was scheduled to take place on November 8, 2013. PCC represented to Legacy Shareholders that the Trust Assets included, among other things, a 25% equity interest in PIC, underwriter warrants, trading and investment securities, cash, accounts receivable and an insurance policy on the life of the founder of PIC. Collectively, the Trust Assets were valued at approximately $16.6 million. Legacy Shareholders overwhelmingly voted in favor of the Restructuring Transaction and the formation of the Liquidating Trust at the meeting of shareholders held on November 8, 2013.

Unbeknownst to Legacy Shareholders, PCC did not create the Liquidating Trust until on or about July 25, 2014, nearly nine months after issuing the October Proxy Statement. Finally on August 8, 2014, PCC's successor, VBI Vaccines, Inc. disclosed in a 10-Q filing with the SEC that the Liquidating Trust was formed with assets "valued at approximately $9.8 million." The August 10-Q filing not only discloses the creation of the Liquidating Trust but also discloses the ownership interests in PIC. Contrary to the representations in the October Proxy Statement, the Liquidating Trust's 25% interest in PIC appears to have been completely eliminated.

On March 5, 2015, the Court issued an Order appointing lead Plaintiff and approving lead Counsel. Lead Plaintiff filed an amended Complaint on March 25.

On March 25, 2016, the Court issued an Order granting Defendants' motions to dismiss with prejudice.