The New York Attorney General on Tuesday asked a court to force Kodak’s CEO to publicly testify amid an investigation over allegations of insider trading.
The petition, filed with the New York County State Supreme Court, claims that chief executive Jim Continenza bought shares of his company’s stock while Kodak was in non-public talks with the White House over a loan worth hundreds of millions of dollars.
The tentative loan, announced as the pandemic took hold, was intended to help Kodak pivot to chemical production to meet industry needs.
“As millions of New Yorkers and Americans across this nation lost their jobs and were waiting for unemployment checks, Kodak’s CEO was using insider information to illegally trade company stock,” Attorney General Letitia James said in a statement.
“We are asking the court to order Mr. Continenza to testify in open court, so the facts can be exposed before the American people,” the statement added.
Specifically, the attorney general is focused on Continenza’s purchase of more than 46,000 Kodak shares early last summer. In July, trading activity picked up in shares of the company ahead of the public announcement of the loan.
Following the announcement, the stock shot higher, gaining more than 300% during a single session.
Kodak responded to the attorney general’s petition on Tuesday saying it had previously offered documents.
“Prior to this filing, the Company repeatedly offered to make witnesses available and the Attorney General repeatedly declined. It is telling that she has now chosen to publicly seek this order asking for the very testimony in which she previously had no interest,” Kodak said in a statement.
Kodak added that Continenza’s purchase took place when he was not in possession of material non-public information, and said that the purchase was part of a pre-approved trading accordance that met compliance standards. The company said this information was later verified by an independent investigation.
Kodak’s stock advanced nearly 5.5% on Tuesday. Over the last year shares are up 187%.
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