Lawyers for biopharmaceutical company Sorrento Therapeutics disputed allegations that they committed bankruptcy fraud, saying that a bank account and mailbox created in Texas justified a chapter 11 filing in the state days later, WSJ Pro Bankruptcy reported. The U.S. Justice Department’s bankruptcy watchdog alleged last week that the bankruptcy filed in Houston by Sorrento subsidiary Scintilla Pharmaceuticals in February 2023 falsely represented that its principal assets and business are in Texas when it is actually based in San Diego. A Sorrento shareholder had separately made allegations in court that the company’s lawyers committed fraud by filing the case in Texas. San Diego-based Sorrento had used Scintilla’s chapter 11 petition in the U.S. Bankruptcy Court in Houston as the basis to file its own petition in that court. The U.S. trustee for the Southern District of Texas said that the Sorrento and Scintilla cases should either be dismissed or transferred out of state, noting that Scintilla is a Delaware-incorporated company that made repeated representations to the California secretary of state in June 2023 that its principal address was in San Diego.
