Riley Investment Management has continued to buy stock in Regent Communications, even as it battles in two courts to try to force Regent to hold a special shareholders meeting at which Riley hopes to place its own representatives on the board of directors. In its latest filing with the SEC, Riley reports that it has increased its stake in Regent to 7.5% of the company’s outstanding stock. Riley’s John Ahn also fired off another letter to the directors and management of Regent, accusing them of wasting the company’s funds by suing Riley and Sanders Morris Harris Group (SMH). The letter noted that the Delaware Chancery Court, where Riley has sued Regent, denied Regent’s motion to dismiss the lawsuit, and a Delaware Federal Court, where Regent has sued Riley and SMH, declined to issue an injunction blocking any special shareholders meeting. "We urge you to stop wasting the Company’s money on further litigation and hold a special meeting. If you convene a meeting to address our proposals, you will have a full opportunity to explain any objections you have to our concerns, and we will have a full opportunity to put the reasons for our concerns before the stockholders, who can then decide," Ahn wrote. Meanwhile, SMH has filed a report with the SEC that it controls 6.9% of Regent’s public stock. Regent’s federal lawsuit had charged that SMH violated federal securities laws by failing to make the required SEC filing when it acquired a 5% stake in Regent (8/16/07 RBR #160).
RBR/TVBR observation: The dissident shareholders had demanded that a special shareholders meeting be held on September 3rd. That deadline has now passed without any such meeting. It now appears to be up to the courts whether there will be such a meeting – and when.