Weekly Wrap Up: Sunday 11/23/2025
Four Fraud Reports: $567M Raised on Fake Trial Data + 96% Rare Earth Exaggeration
Activist short sellers delivered four powerful reports this week, exposing corporate misconduct across biotechnology, data services, mining, and REITs. From clinical trial manipulation at a biotech that changed endpoints without FDA approval, to accounting fraud at a paper storage company hiding 8.7x leverage, to a mining promoter exaggerating rare earth content by 96%, researchers uncovered a range of deceptive practices. Meanwhile, Grizzly Research published a comprehensive study examining what happens when companies sue short sellers, and the UK FCA launched consultations on changes to short selling regulations that could impact activist research across European markets.
This Week's New Reports
- Four new reports released this week targeting companies across biotechnology, sports technology, mining, and data storage with significant market impact on most targets despite one notable exception
- Culper Research exposed Praxis Precision Medicines ($PRAX) for manipulating Phase 3 trial results, changing endpoints from 12 to 8 weeks without FDA approval after an independent committee recommended stopping for futility—the stock dropped 10.3% for the week
- The Bear Cave questioned Sportradar Group's ($SRAD) business quality and grey market operations—yet the stock showed remarkable resilience, closing the week virtually flat at -0.2%
- Ningi Research called Critical Metals Corp ($CRML) a promotional vehicle with a 96% exaggeration of valuable rare earth content and 14+ years of missed deadlines—the stock declined 14.1% by week's end after a delayed reaction
- Gotham City Research revealed Iron Mountain's ($IRM) accounting manipulation hiding 8.7x-8.9x leverage as 5.0x while implementing exploitative 35%-319% price increases—the stock dropped 4.8% for the week amid growing SEC scrutiny
New Activist Reports
Praxis Precision Medicines PRAX
NASDAQ | Culper Research
November 20, 2025Culper Research's report had a significant immediate impact on PRAX, with the stock plummeting 13.3% on the day of publication. The allegations of clinical trial manipulation and endpoint changes sent shockwaves through the biotech sector. While the stock recovered slightly by week's end, it still closed down 10.3% from pre-report levels, suggesting investors took the fraud allegations seriously despite the company's attempts to defend its trial methodology.
About Praxis Precision Medicines:Praxis Precision Medicines is a clinical-stage biopharmaceutical company developing therapies for central nervous system disorders. The company's lead candidate, ulixacaltamide, is being developed for essential tremor treatment. Praxis went public in 2020 and has been touted as a precision medicine innovator targeting genetically defined patient populations. The drug at the center of the controversy was acquired for just $1 million in 2018 after previous developers failed to advance it, yet the company recently raised $567 million following its "positive" Phase 3 results announcement.
Key Points from the Report:- Changed primary trial endpoint from 12 weeks to 8 weeks without FDA approval after independent data monitoring committee recommended stopping for futility
- Mishandled data from 36% patient discontinuation rate through questionable statistical methods
- Drug acquired for just $1 million in 2018 after previous developers abandoned it, yet company raised $567 million following "positive" results
- Three similar drugs with the same mechanism of action have already failed in development
- Former FDA managers and biostatisticians validated Culper's concerns about the trial methodology
Sportradar Group SRAD
NASDAQ | The Bear Cave
November 20, 2025The Bear Cave's research report had minimal lasting impact on Sportradar's stock price. While the stock dipped 7.3% intraday on the report date, it recovered strongly by the close, finishing down just 2.7%. By week's end, SRAD had nearly fully recovered, closing virtually flat at -0.2% from pre-report levels. The market's muted reaction suggests investors either dismissed the concerns about grey market operations and competitive threats, or these issues were already priced in. This represents one of the weakest responses to an activist report this week.
About Sportradar Group:Sportradar Group is a Switzerland-based sports technology company that provides data collection, analytics, and software solutions to sportsbooks and sports organizations worldwide. Founded in 2001, the company has established partnerships with major sports leagues including the NBA, NHL, and MLB. Sportradar operates in over 12 countries with more than 4,500 employees and serves over 800 clients globally. The company markets itself as "the global leader in sports technology" and provides real-time sports data feeds, betting software platforms, and integrity monitoring services to detect match-fixing and irregular betting patterns.
Key Points from the Report:- Works with grey market operators like Stake (Curaçao-based) and 188Bet (Belize/Anjouan-licensed), raising questions about facilitating gambling it claims to police
- Investors overestimate business quality and competitive moat while underestimating growing competition from new entrants
- Faces significant headwinds from prediction markets that could disrupt the traditional sports betting data model
- Concerning allegations about the integrity of operations in jurisdictions with weak regulatory oversight
- Business model vulnerabilities as alternative data sources and direct league partnerships proliferate
Critical Metals Corp. CRML
NASDAQ | Ningi Research
November 18, 2025Ningi Research's damning report initially had a muted impact on CRML, with the stock closing down just 0.4% on the report date. However, the delayed reaction proved significant as the stock continued to deteriorate throughout the week, ultimately plummeting 14.1% by week's end. This pattern suggests that as investors digested the extensive technical evidence about the non-viability of both flagship projects and the CEO's troubling track record, they increasingly headed for the exits. The delayed but substantial decline indicates the report's allegations gained credibility over time.
About Critical Metals Corp.:Critical Metals Corp. is a mining development company focused on rare earth elements and lithium projects. The company's two flagship assets are the Tanbreez rare earth project in Greenland and the Wolfsberg lithium project in Austria. Critical Metals has positioned itself to capitalize on the growing demand for critical minerals needed for electric vehicles and renewable energy technologies. The company has attracted attention from retail investors excited about the green energy transition, but has yet to achieve commercial production at either project despite years of promises and promotional efforts.
Key Points from the Report:- Tanbreez project claims 75% valuable rare earth content when actual magnet REO is only 3.26% - a 96% exaggeration
- Eudialyte ore creates non-filterable silica gel during processing, making it commercially unprocessable - a "fatal flaw"
- Wolfsberg lithium project has failed to advance for 14+ years with Austrian officials questioning if it's designed to "drive up share price and sell at a profit"
- CEO Tony Sage's track record shows every publicly traded company he's been associated with is down 91-100% or delisted
- Leadership has history of police raids, regulatory fines, and investigations spanning 15+ years
Iron Mountain Inc. IRM
NASDAQ | Gotham City Research
November 19, 2025Gotham City Research's explosive report on Iron Mountain's accounting manipulation and exploitative pricing practices had a measured but persistent negative impact on the stock. IRM dropped 7.8% intraday before recovering to close down 2.9% on the report date. The stock continued to decline throughout the week, ending down 4.8% from pre-report levels. The sustained pressure suggests investors are taking the allegations of leverage manipulation, executive departures, and SEC scrutiny seriously. For a large-cap REIT with typically stable trading patterns, this represents a significant vote of no confidence in management's accounting practices.
About Iron Mountain Inc.:Iron Mountain Inc. is a global leader in storage and information management services, founded in 1951 and now operating as a REIT. The company provides physical storage for documents and media, data center space, and digital information management services to businesses worldwide. Iron Mountain has evolved from a traditional paper storage business into a hybrid model that includes data center operations, attempting to position itself for the digital age. The company operates thousands of facilities globally and has long been considered a stable dividend-paying stock, though its core business of physical document storage faces secular decline as companies digitize their records.
Key Points from the Report:- Artificially reduces reported leverage from 8.7x-8.9x to 5.0x through suspect accounting adjustments
- Implemented exploitative price increases of 35%-319% on core services, triggering customer lawsuits and regulatory scrutiny
- Free cash flow has been negative for 12 consecutive years while dividends are not covered by actual cash generation
- 40 executives departed since March 2024 following COO retirement, suggesting internal awareness of problems
- $215 million in insider selling with over half occurring in 2025 alone
- SEC began questioning Adjusted EBITDA calculations in early 2025, with scrutiny expected to intensify
- Price target of $23-$41 per share represents 54%-74% downside from $89.28 pre-report price
Activ8 Newswire
Recent articles and news from around the activist short selling world
Grizzly Research Releases Study on Companies Suing Short Sellers
Grizzly Research published an in-depth analysis examining the outcomes of companies that have filed lawsuits against short sellers. The study provides crucial insights into the effectiveness of legal action as a defensive strategy against activist short campaigns and the long-term stock performance of companies that pursue litigation.
Source: Grizzly Research
UK FCA Consults on Changes to the Short Selling Regime
The UK Financial Conduct Authority (FCA) has launched a consultation on proposed changes to the short selling regulatory framework. The consultation addresses disclosure requirements, reporting thresholds, and transparency measures that could significantly impact how activist short sellers operate in UK markets. This development reflects ongoing global debates about appropriate regulation of short selling activities.
Source: JD Supra
PACs CEO: New Chapter Begins with Stronger Compliance Framework
Post Acute Medical (PAM), which has been the target of multiple short seller reports in recent years, announced a "new chapter" focused on enhanced compliance and governance. The company's CEO highlighted improvements to internal controls and regulatory compliance frameworks following scrutiny from activist researchers. This represents a case study in how companies respond to and attempt to address concerns raised by short sellers.
Source: Skilled Nursing News
Roblox CEO Clashes with Reporters Over Child Safety Concerns
Roblox CEO David Baszucki faced pointed questions from reporters regarding ongoing child safety concerns on the platform. The gaming company has been under increased scrutiny from short sellers and journalists who have raised alarms about predatory behavior and inadequate safety measures. The contentious exchange highlights the mounting pressure on Roblox to address safety issues that have become central to the investment thesis of several prominent short sellers.
Source: Game Developer
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