Stockholm, October 29, 2013 - The Disciplinary Committee of NASDAQ OMX Stockholm AB (“the Exchange”) has found that Forestlight Entertainment AB (“Forestlight”), whose shares are traded on First North, has contravened the First North Nordic Rulebook (“the Rulebook”) in respect of disclosures and has ordered Forestlight to pay a fine of SEK 100,000 corresponding to two annual fees.
The case concerns Forestlight’s violation of Item 4.2 (a) of the Rulebook.
According to the investigation, Forestlight published a press release on May 13, 2013 under the title “Forestlight Entertainment has new owners and receives capital contribution.” This press release had a positive impact on the price of the company’s share.
Later that same day, the company withdrew the aforementioned press release by publishing another press release stating that it had been distributed by mistake and that it contained incorrect information. This resulted in the share price falling back to the level that it had traded at prior to the first press release. According to the investigation, however, it is apparent that the reason for the withdrawal was that not all of the agreements had yet been signed. On May 15, 2013, Forestlight published a press release under the title “Forestlight Entertainment has new owners and receives capital contribution.” The third press release had essentially the same text as the first release, apart from the name of the acquirer being specified. The press release had a positive impact on the price of the company’s share.
The Disciplinary Committee is of the opinion that before all of the agreements had been signed it was wrong for Forestlight to publish the first press release using the wording that it had, but accepts the company’s explanation that this was not due to shortcomings in its procedures but due to a misunderstanding.
However, the Disciplinary Committee believes that the press release regarding the withdrawal also provides grounds for criticism. The company stated that the previous press release had contained incorrect information, which was misleading since, according to the information provided by the company in this case, the matter did not involve incorrect information but that not all of the documentation had been signed. Trading in the share after the second press release indicates that investors had acted on the assumption that the information in the first press release had been incorrect.
Accordingly, the Disciplinary Committee finds that Forestlight has violated the Rulebook requirements that information published by the company has to be correct, relevant and clear and must not be misleading.
The violation is deemed neither negligible nor excusable. Accordingly, the company is to be subject to disciplinary sanction.
A more detailed description of the case and the Disciplinary Committee's decision is published on:
Participating in the Committee’s decision were former Supreme Court Justice Johan Munck, Supreme Court Justice Marianne Lundius, Professor Emerita Madeleine Leijonhufvud, Company Director Carl Johan Högbom and Company Director Stefan Erneholm.
About the Disciplinary Committee
The role of NASDAQ OMX Stockholm’s Disciplinary Committee is to examine cases where Exchange Members or listed companies have breached the rules and regulations applying on the Exchange. If NASDAQ OMX Stockholm suspects that a member or a listed company has acted in breach of NASDAQ OMX Stockholm’s rules and regulations, the matter is reported to the Disciplinary Committee. NASDAQ OMX Stockholm investigates and prosecutes the case and the Disciplinary Committee assesses the case and issues a ruling regarding possible sanctions. The sanctions possible for listed companies are a warning, a fine or delisting. The fines that may be imposed range from one to 15 annual fees. The sanctions possible for Exchange Members include a warning, a fine or debarment. The fines imposed by the Committee are not included in the Exchange’s business but are attributed to a foundation supporting research in the securities market. The Disciplinary Committee's Chairman and Deputy Chairman must be lawyers with experience of serving as judges. At least two of the other members of the Committee must have in-depth insight into the workings of the securities market.
Members: Former Supreme Court Justice Johan Munck (Chairman), Supreme Court Justice Marianne Lundius (Deputy Chairman), Professor Emerita Madeleine Leijonhufvud, Company Director Stefan Erneholm and Company Director Anders Oscarsson. Deputies: Former Authorized Public Accountant Bo Magnusson, Lawyer Wilhelm Lüning, Company Director Jack Junel, Ragnar Boman (MBA) and Carl Johan Högbom (MBA).
Christina Malmberg Hägerstrand
+ 46 8 405 6583
Nasdaq Press Center
Read the latest press releases, request a press kit, and get in touch with our press team.