PixarBio Corp. et al.

U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 26029 / June 14, 2024

Securities and Exchange Commission v. PixarBio Corp. et al., No. 18-cv-10797-WGY (D. Mass., filed April 24, 2018)

Notice of Voluntary Dismissal Filed as to Defunct Entity and Deceased CEO

On June 14, 2024, the Securities and Exchange Commission filed a Notice of Voluntary Dismissal as to all claims against PixarBio Corporation and its former CEO, Frank M. Reynolds, the two remaining defendants in the case. PixarBio is defunct, and Reynolds is deceased.

On April 24, 2018, the Commission charged PixarBio, a biotech start-up, and Reynolds, with misleading investors with false claims about the company’s progress in developing a purported method of delivering non-opiate, post-operative pain medication. The complaint also alleged that Reynolds, with two others, engaged in a fraudulent scheme to acquire and merge PixarBio with a publicly traded company and to secretly manipulate the sales of shares in the new entity. The Commission’s case was stayed on September 4, 2018, in connection with parallel criminal charges filed against Reynolds for the same conduct alleged in the SEC’s complaint. A federal jury found Reynolds guilty of one count of securities fraud and three counts of obstructing an agency proceeding in the parallel criminal case. He was sentenced to seven years in prison. While his criminal appeal was pending, Reynolds died in prison on January 9, 2022. The United States Court of Appeals for the First Circuit on April 9, 2024 dismissed the appeal and remanded to the district court for it to vacate the judgment of conviction and dismiss the indictment.

The dismissal filed today concludes the Commission’s litigation in this matter.