In full: Gotham City defends £1bn Quindell raid

Oliver Smith
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Gotham City Research, the mysterious US short seller who last week wiped nearly £1bn from the value of Quindell following a scathing blog post, explained its actions in an email to City A.M. yesterday.

"Gotham City Research is a firm believer of a free society, democracy, and free speech. Consequently, we believe that short selling and activist investing are extensions of free speech, exercised and practised in the financial markets. Moreover, we believe that the protection of short selling and activist investing (as the expression of free speech) in financial markets is critical to market integrity (as markets are mechanisms by which information is priced),” the firm said.

In Gotham’s original blog posting entitled “Quindell: A Country Club Built On Quicksand” Gotham wrote: “You should assume that as of the publication date of this report, Gotham City Research stands to profit in the event the issuer’s stock declines”.

Quindell last week said that it has reported Gotham City to the FCA on grounds of a coordinated shorting attack, and initiated legal action against Gotham.

On Gotham’s blog posting Quindell added that its allegation are: “highly defamatory, deliberately misrepresentative and entirely rejects the conclusions that are made.”

Gotham continued in its email to City A.M. "Now, given our commitment to free speech, we take it upon ourselves not to abuse it. We avoid using inflammatory language, and hyperbole. We prefer providing 10 to 100 facts for every one opinion stated. We seek, both in substance and form, to convey our underlying goal: the pursuit of truth via Socratic/Dialectic method(s). Will will not return evil with evil; rather, we will seek to overcome evil with good, using Truth as our sword and our shield.”

“We encourage you to compare our rhetoric against others' rhetoric, and see if we are correct. We are imperfect vessels, and open to your constructive suggestions.”

On 17 April, prior to Gotham’s original blog post, Quindell’s shares traded at 39.50p, as of today's trading they have now fallen over 50 per cent to 19.3p.

(Parts of Gotham’s correspondence with City A.M. has been omitted due to ongoing legal action between the firms)

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