Cerebral is suing its ousted co-founder Kyle Robertson, alleging he never repaid a loan received from the digital mental health company.
According to a court case filed last week in New York, Cerebral said Robertson defaulted on a nearly $50 million loan he took out in January to buy 1.06 million shares of common stock in the company. Cerebral alleges that Robertson is personally liable for more than half of the loan amount, plus interest and attorney’s fees.
The lawsuit said the co-founder of the digital mental health startup had the option of paying cash or ordering Cerebral to buy back or cancel the pledged shares. Cerebral alleges that Robertson “repeatedly asserted that he would not repay the loan despite being obligated to do so under the memo within six months of his termination.”
Robertson was replaced as CEO from the company in May as Cerebral faced growing controversy over its prescribing practices, particularly for controlled substances like Adderall. He did not immediately respond to a request for comment from Bloomberg about the trial.
THE GREAT TREND
The struggling mental health company scooped up a slew of dollars from investors last year, including a $300 million raised announced in December 2021. In April, a former Cerebral executive the company sued, alleging he was fired after speaking out against unethical prescribing practices. Cerebral said he believed the complaints were “without merit”.
In May, the company confirmed that it had received a grand jury subpoena of the United States Attorney’s Office for the Eastern District of New York on possible controlled substance violations. The Wall Street Journal also reported that Cerebral is under investigation by the Federal Trade Commission. The company said so stopped prescribing most controlled substances.
Earlier this month, Initiated reported letter leak of Robertson, arguing that Cerebral unfairly blamed him for the company’s prescription policies that he faced homophobic remarks from Cerebral executives and directors. The letter asked for internal documents and records, which could be a sign of a possible upcoming lawsuit.