Defendants charged in the alleged fraud involving Hometown International Inc. (OTCPK:HWIN) − the stock whose valuation hit $100M despite only owning a small New Jersey deli − have some high powered attorneys representing them.
Bernie Madoff’s former attorney Ira Sorkin is representing defendant James Patten, while Peter Coker Sr.’s attorney is Mark Agnifilo, who defended “pharma bro” Martin Shkreli in the past.
Patten and Coker appeared Tuesday in New Jersey federal court after prosecutors charged them in an alleged scheme that led to a $100 million valuation for HWIN even though the firm only owned a single deli. They both pleaded not guilty, were released on $100,000 unsecured bond and agreed to surrender their passports, the U.S. Attorney’s office confirmed to Seeking Alpha.
Coker’s son Peter Coker Jr. was also charged, but authorities list him as living in Hong Kong and he did not appear.
The three men allegedly used Hometown International Inc. (OTCPK:HWIN), which operated one deli in Paulsboro, N.J., and a separate shell company, E-Waste Corp. (EWST) to artificially inflate the price of both stocks. Authorities claim the men also used the companies to do transactions, and ultimately disposed of their shares at “grossly inflated” prices.
Shares of Hometown, where the New Jersey deli reported less than $40,000 in annual revenue, went from $1/share in October 2019 to nearly $14 per share by April 2021. The U.S. Securities and Exchange Commission claimed that led to a “grossly inflated market capitalization” of $100 million, Hometown (OTCPK:HWIN) was delisted in late April 2021.
The charges come after Hometown International (OTCPK:HWIN) attracted a lot of publicity last April after famed hedge fund manager David Einhorn of Greenlight Capital discussed the meteoric rise of the stock.
“The pastrami must be amazing,” Einhorn wrote in the April 2021 letter.
