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Investor
and Media Relations:
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Marty
Tullio, Managing Partner
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McCloud
Communications, LLC
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marty@mccloudcommunications.com
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CNS
RESPONSE FILES ACTION AGAINST ITS FORMER CEO
Costa Mesa, CA – July 2, 2009
– CNS Response, Inc. (OTCBB: CNSO) today announced that it has filed an action
in the United States District Court for the Central District of California
against Len Brandt, the Company’s former CEO, who was terminated on April 10,
2009, and certain others. In the action, captioned CNS Response, Inc. v. Leonard
Brandt, EAC Investment LP and EAC Investment, Inc., CNS Response alleges
that Mr. Brandt and the other defendants have violated federal securities laws
in connection with their solicitation of proxies and written consents and
attempts to call and hold a special meeting in lieu of the annual meeting of
stockholders.
“Although
we would prefer to devote management’s time and attention and the stockholders’
money to implementing our business plan, Mr. Brandt’s continued attempts to
disrupt the company and disenfranchise other stockholders and his ongoing
failures to comply with SEC rules left us no choice but to pursue this lawsuit,”
CNS Response CEO George Carpenter commented. “Our plan is to hold an annual
meeting to elect directors in September 2009, and the board of directors
believes that providing a process through which all of our stockholders can
participate and vote and allowing the company time to comply with our charter,
bylaws and applicable law is in the best interests of the
stockholders.”
As
previously announced, Mr. Brandt has been mailing to stockholders multiple forms
of a “Notice of Special Meeting of Stockholders of CNS Response, Inc.” These
communications purport to call a special meeting of CNS Response stockholders on
June 30 or July 3. Because the Company has obtained certain
information leading it to believe that the defendants have been improperly
soliciting proxies for those purported meetings and/or have failed to make
filings with the SEC when required by SEC rules, the Company determined that it
was necessary for the protection of its other stockholders to file a lawsuit in
federal court making these allegations.
As part
of the lawsuit, CNS Response is seeking an injunction enjoining the use of
proxies and written consents that Mr. Brandt or the other defendants have
obtained in violation of law, an injunction or declaratory judgment declaring
all of the proxies obtained by Mr. Brandt to be invalid, an injunction against
further unlawful proxy solicitation by the defendants, an injunction enjoining
any further violations of Section 13(d) and 14(a) under the Securities Exchange
Act of 1934 and ordering that remedial disclosures be filed, and damages in an
amount to be determined.
Additional
Information and Where to Find It
This
release may be deemed to be solicitation material in respect of the matters to
be considered at the Company’s 2009 Annual Meeting of Stockholders and/or the
purported special meeting called by Mr. Len Brandt. The Company intends to file
a proxy statement with the Securities and Exchange Commission (“SEC”).
SECURITYHOLDERS ARE URGED TO READ THE PROXY STATEMENT AND ANY OTHER RELEVANT
DOCUMENTS FILED OR THAT WILL BE FILED WITH THE SEC WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Security holders will be able
to receive the proxy statement and other relevant documents free of charge at
the SEC’s Web site at www.sec.gov or from the Company at 2755 Bristol Street,
Suite 285, Costa Mesa, CA 92626.
-more-
CNS
RESPONSE FILES ACTION AGAINST ITS FOMER CEO
Page
2
Participants
in Solicitation
CNS and
its directors and executive officers and other members of management and
employees may be deemed to be participants in the solicitation of proxies in
respect of the matters to be considered at the Company’s 2009 Annual Meeting of
Stockholders and/or the purported special meeting called by Mr. Len Brandt.
Information regarding the interests of the Company’s directors and executive
officers in the proxy contest will be included in its definitive proxy
statement.
About
CNS Response
Today,
most physicians are able to base treatment on objective test data, such as EKGs,
MRIs, blood tests, etc. Broadly speaking, such advances have not yet
come to those physicians practicing psychiatry.
CNS
Response has developed a patented data-analysis capability that, with the help
of a simple, non-invasive EEG, will analyze a patient’s brain waves and compare
the results to an extensive patient outcomes database. The process produces a
rEEG® report providing a psychiatrist with guidance to personalize medication
regimens for a patient, based on the patient’s own brain physiology. To read
more about the benefits this patented technology provides physicians, patients
and insurers, please visit the CNS Response website,
www.cnsresponse.com.
Safe Harbor Statement Under
the Private Securities Litigation Reform Act of 1995
Except
for the historical information contained herein, the matters discussed are
forward-looking statements made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995, as amended. These statements
involve risks and uncertainties as set forth in the Company's filings with the
Securities and Exchange Commission. These risks and uncertainties could cause
actual results to differ materially from any forward-looking statements made
herein.
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