When the SEC issued its cease-and-desist order against Anson Funds Management LP and Anson Advisors Inc. on June 11, 2024, it didn’t just fine a hedge fund. It formally confirmed — on the public record — that a coordinated, multi-year market manipulation scheme operated from at least 2018 through 2023, targeting public companies and their shareholders. Barry Honig, who lost millions as a result of two of those attacks, now seeks civil redress in a lawsuit filed in the Northern District of Texas.

This article walks through what the regulatory record shows, what the indictment adds, and what the civil complaint filed May 6, 2026 — Honig v. Anson Funds Management LP et al., Case No. 3:26-cv-01167-S — alleges as a result.

1. The SEC’s Findings: A Confirmed Scheme, Not a Theory

The SEC’s administrative order (Inv. Adv. Act Rel. No. 6622) is the foundation of the case against Anson. The order found that Anson Funds and Anson Advisors, co-advisers of the Anson Investments Master Fund (AIMF), willfully violated multiple provisions of the Investment Advisers Act:

Section 206(4) and Rule 206(4)-8 — anti-fraud provisions applicable to investment advisers managing pooled vehicles;

Sections 204 and Rule 204-2 — recordkeeping obligations;

Rule 206(4)-7 — compliance procedures.

The operative finding: Anson’s Private Placement Memorandum described a short-selling strategy but materially omitted that the strategy involved (a) coordinating with activist short publishers; (b) trading around those publications; and (c) compensating publishers with a share of AIMF’s trading profits in exchange for advance access to their work.

 ‘From at least 2018 through 2023, the Private Placement Memorandum for Anson Investments Master Fund described a short position investment strategy… but omitted that AIMF’s investment strategy involved working with activist short publishers and trading in the target securities, including around the time the reports were issued by activist short publishers, and paying a portion of AIMF’s trading profits to the short publishers.’ — SEC Order, Rel. No. 6622, June 11, 2024

The SEC found that Anson’s share of profits paid to ‘Individual A’ (identified in the civil complaint as Andrew Left of Citron Research) exceeded $1.1 million in connection with just two target securities. Critically, those payments were not made directly. Anson routed them through a third-party intermediary — identified in the civil complaint as Kurt Feshbach of Falcon Research — using invoices for purported ‘research services’ that were never performed. Anson then recorded these payments on its books as payments to Falcon for research, in violation of the Advisers Act’s books-and-records requirements.

2. The DOJ Indictment: Criminal Charges That Mirror the SEC Findings

On July 25, 2024, a federal grand jury in the Central District of California returned a 19-count indictment against Andrew Left (United States v. Andrew Left, No. 2:24-cr-00456-TJH), charging him with one count of engaging in a securities fraud scheme, 17 counts of securities fraud, and one count of making false statements to federal investigators.

The indictment references a ‘Hedge Fund A’ that paid Left through ‘Individual F’ via a third-party intermediary — language that maps directly onto Anson and Feshbach as identified in the civil complaint. Left is alleged to have shared planned negative publications with Hedge Fund A in advance, allowing the fund to establish short positions before reports were released, then cover those positions after prices declined — generating millions in trading profits that were then shared with Left.

The DOJ’s theory of criminality: Left’s publications were not independent research but paid promotional attacks. His representations to investors that Citron had ‘never been compensated by a third party to publish research’ were, the government alleges, simply false. In August 2019, Left made precisely that claim publicly. The indictment characterizes this as a material misrepresentation to investors who relied on Citron’s purported independence.

The indictment also expressly names PolarityTE as one of the companies targeted by the scheme — providing a direct evidentiary foundation for the civil claims now pending in Dallas.

3. The PolarityTE Attacks: False Claims, Real Damage

The civil complaint describes two coordinated Citron Research attacks on PolarityTE in 2018, both of which the plaintiffs allege were orchestrated by Anson and executed through Left:

Attack 1 — June 25, 2018: Citron published a report entitled ‘Citron Exposes History of FRAUD Behind PolarityTE.’ The central claim: PolarityTE’s patent application was ‘dead on arrival’ following a USPTO rejection notice. The report called the situation ‘not only securities fraud, but… criminal and not just civil fraud.’

The legal and factual problem: A USPTO ‘final rejection’ is a term of art, not a terminal event. Under 37 C.F.R. §§ 1.113 and 1.114, an applicant receiving a final office action has six months to file a Request for Continued Examination (RCE), amend the application, or submit new evidence. Statistics bear out that applicants who continue prosecution after a final rejection receive a patent approximately 70% of the time. PolarityTE filed an RCE, continued prosecution, and was ultimately granted Patent No. US 10,92,001 B2 in February 2021 — two and a half years after Citron declared the application dead. The class action lawsuit premised on the patent narrative was subsequently dismissed.

Attack 2 — October 18, 2018: A second Citron report, ‘PolarityTE: This Game Is Over! Price Target -$2,’ recycled the patent misrepresentation and introduced a new attack: a standard FDA Form 483 ‘inspectional observations’ letter, which the report characterized as proof that the FDA had ‘proven’ PolarityTE was a ‘stock scheme.’ The FDA Form 483, by its express terms, ‘does not represent a final Agency determination regarding [the company’s] compliance.’ The FDA took no further regulatory action.

Market impact: The first attack caused a single-day decline exceeding 33%, and nearly 50% within a week. The second attack caused an additional 17% decline. Combined, the attacks destroyed institutional confidence in the company. Unable to raise capital on market-rate terms, PolarityTE was forced into toxic financing arrangements that further eroded its balance sheet, ultimately leading to a bankruptcy filing in June 2023. Shares went to zero.

4. The Civil Claims: What Honig Is Seeking

Filed in the Northern District of Texas (which has jurisdiction given Anson Funds’ Texas domicile), the First Amended Complaint asserts five causes of action under Texas law:

1. Business Disparagement — False and malicious statements that caused economic harm to Honig’s investment interests in PolarityTE.
2. Tortious Interference — Honig held preferred convertible shares in PolarityTE under publicly disclosed contracts; Defendants’ manipulation of PolarityTE’s stock price directly affected the conversion formula in those contracts, impairing their value.
3. Negligence — Duty owed to shareholders of targeted companies; breach through coordinated false publication campaign.
4. Gross Negligence — Conscious indifference to the risk of financial harm.
5. Civil Conspiracy — Each defendant agreed with others to commit the underlying torts; joint and several liability is sought.

Vicarious liability is also pled: Kassam and Puri’s conduct occurred within the scope of their roles at Anson; Anson is liable under respondeat superior.

On the statute of limitations, the complaint invokes the discovery rule: the scheme’s existence was not publicly knowable until the DOJ indictment and SEC enforcement action were announced in July 2024. The complaint alleges Honig could not, through reasonable diligence, have identified the concealed coordination between Anson, Left, and Choi before that date. 

5. The Broader Accountability Picture

This is not a case where a plaintiff is challenging opinions or subjective analysis. The SEC order, the DOJ indictment, and the settling defendants’ own payments have already established the factual core of the scheme on the public record. Choi paid over $1.8 million to settle SEC charges and is cooperating with the DOJ prosecution. Anson paid $2.25 million in civil penalties and is cooperating. Left faces 19 criminal counts and potential decades in prison.

What the civil litigation in Dallas adds is accountability to the shareholders who were neither named parties in the SEC action nor compensated by Anson’s penalty payments. The SEC’s enforcement mandate is systemic deterrence; civil litigation is the mechanism by which individual victims — including Honig, whose entities held nearly 10% of PolarityTE at the time of the attacks — seek to recover actual losses.

The broader significance: the Left trial, currently scheduled for 2026, will expose the full architecture of a short-and-distort infrastructure that operated for five years across more than a dozen public companies. For the companies and shareholders who were targeted — and for the market integrity principles at stake — that trial represents the most consequential public reckoning yet with the mechanics of coordinated market manipulation.

Seven years is a long time to wait for the record to be set straight. The record is now being set.

For seven years, Barry Honig’s name was dragged through the mud by short sellers who called the companies he backed frauds, scams, and stock schemes. The media repeated those claims without question. Now the U.S. government has confirmed what Honig always said: it was a coordinated lie.

 What Is a ‘Short-and-Distort’ Scheme?

Most people have heard of ‘pump and dump’ — where someone hypes a stock to drive the price up, then sells. A ‘short-and-distort’ is the opposite. Short sellers bet that a stock will fall, then deliberately spread false negative information to make that happen. It’s illegal. And it’s exactly what the SEC and DOJ found was happening.

 What Exactly Did the Government Find?

In June 2024, the SEC charged Anson Funds Management — a $2.9 billion hedge fund — with running a secret scheme from 2018 to 2023. Here’s how it worked, in plain terms:

1. Anson would quietly ‘short’ a company’s stock — meaning they placed bets that the stock would fall.
2. They then paid Andrew Left of Citron Research to publish false, alarming reports about those same companies.
3. Left would blast these reports out to hundreds of thousands of followers on Twitter, CNBC, and his website — calling companies ‘fraud,’ ‘scam,’ or ‘dead.’
4. Investors panicked, sold their shares, the stock crashed, and Anson collected its profits.
5. To hide the payments to Left, Anson funneled the money through a third party called Falcon Research, using fake invoices for ‘research services’ that were never actually performed.

 PolarityTE: A Real Company Destroyed by Lies

One of the targets was PolarityTE — a biotech company that had developed SkinTE, a revolutionary product that used a patient’s own skin to heal wounds. Barry Honig and his family entities were the second-largest shareholders, owning nearly 10% of the company.

In June 2018, Citron Research published a report with a headline screaming ‘FRAUD’ in all capitals. The report claimed PolarityTE’s patent was dead — that the USPTO had permanently rejected it and the company had hidden the news.

Both claims were false.

A USPTO ‘final rejection’ is a technical term — it’s a step in the process, not the end of the road. Applicants who continue forward receive a patent roughly 70% of the time. PolarityTE did exactly that, and in February 2021, the USPTO granted the patent. The company was never hiding anything — the patent process simply wasn’t over.

The false narrative about PolarityTE’s patents was demonstrably false — demonstrated by the USPTO allowing its patent, and the class action lawsuit ultimately was dismissed. — Honig v. Anson Funds, First Amended Complaint

But the damage was already done. The stock crashed over 40% on the day of the first attack. Institutional investors fled. PolarityTE lost its financing, declared bankruptcy in 2023, and its shares went to zero. Honig and his family lost millions.

 7 Years of Fake News — Now Confirmed

For years, Barry Honig’s name appeared in articles that treated short-seller reports as gospel truth. Those reports called him a ‘stock promoter’ for ‘failed companies’ — language Citron used to smear anyone connected to its targets. The media amplified the attacks without checking whether the underlying claims were true.

As the new lawsuit filed in May 2026 states, the defendants ‘made false and disparaging statements about PolarityTE and Plaintiffs’ business… with knowledge that they were false or with no reasonable grounds for believing them to be true.’

Honig’s RIOT Blockchain investment — another Citron target — was cleared by the SEC in 2020. RIOT Platforms today is worth billions. MARA Holdings, another company Honig helped build, is also a multi-billion dollar enterprise. The ‘frauds’ turned out to be real companies.

 Now It’s Left Who Faces Justice

In July 2024, the Department of Justice indicted Andrew Left on 19 criminal counts — including securities fraud and lying to federal investigators. He faces up to 365 years in prison. His trial is currently scheduled for 2026.

The indictment describes the scheme in detail, including a ‘Hedge Fund A’ that secretly paid Left through a third-party intermediary — matching precisely what the SEC found about Anson Funds.

 Ryan Choi, Left’s partner who executed trades at Citron Capital, settled with the SEC and paid over $1.8 million. Anson itself paid $2.25 million in penalties. Hindenburg Research — another short seller connected to the broader network — shut down while investigations were ongoing.

The Bottom Line

Barry Honig didn’t need to wait for a trial to be vindicated. The SEC already confirmed the scheme was real. The DOJ already confirmed PolarityTE was a named target. The patent was already granted. The class action lawsuit was already dismissed.

 What took seven years wasn’t the truth — it was the government catching up to it.

The Andrew Left trial may finally put a face and a prison sentence on what was done. But the record is already clear: Barry Honig was the victim of a coordinated, government-confirmed fake news campaign — and the perpetrators are now the ones facing accountability.

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The Technology Driving EnvisionLED Performance

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Building a Financial Case for LED Upgrades

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Sourcing High Performance Lighting Solutions

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Commercial and Industrial Applications

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Environmental and Regulatory Advantages

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Integrating Smart Controls for Deeper Savings

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The convergence of LED efficiency and intelligent controls reflects a broader transformation in building operations. Infrastructure is increasingly interconnected, generating insights that inform strategic decisions. Lighting systems that once operated independently now contribute to comprehensive energy management frameworks. By combining advanced hardware with responsive software, organizations unlock deeper layers of savings. EnvisionLED lighting solutions, deployed within such systems, represent a forward looking investment in sustainable performance.

A Durable Investment in Efficiency

The long term outlook for LED technology remains strong. Ongoing advancements in chip design and materials science continue to improve efficacy and reliability. As production scales and competition intensifies, pricing remains accessible to a wide range of organizations. Early adopters capture immediate savings while positioning themselves for future enhancements. The economic and environmental logic aligns in favor of continued transition.

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