Valencia biotech firm MannKind Corp.'s stock fell 11% Thursday after reports that a former senior manager said he had uncovered potentially serious problems with clinical trials of the company's experimental insulin inhaler.

The Food and Drug Administration is reviewing the Afrezza inhaler and is expected to make a decision Dec. 29 on whether to approve it.

The former MannKind manager, John Arditi, filed a lawsuit against the company in New Jersey Superior Court, saying he was wrongfully fired after internal audits he conducted in November 2009 uncovered "potential fraud and scientific misconduct" involving Afrezza clinical trial data. The lawsuit, which was filed in September, was first reported on TheStreet.com.

Arditi, who worked in a MannKind facility in New Jersey, said in the lawsuit that he urged his superiors at the firm to report his findings to the FDA but that the company refused because "if the FDA was notified of these concerns, it might delay approval" of the inhaler.

MannKind addressed the lawsuit in its most recent quarterly earnings report, stating that the company had completed an internal investigation into Arditi's claims and had hired an outside firm to conduct an independent investigation.

"Neither investigation found any basis for his claims," MannKind said. "The company believes that the allegations in the complaint are without merit and intends to defend against them vigorously."

Matthew J. Pfeffer, MannKind's corporate vice president, said the company was working on a legal response to the lawsuit. MannKind has until Dec. 3 to file its response in court, Pfeffer said.

MannKind has yet to share with the FDA the findings of its internal investigation or of the independent investigation, he said.

Two Tulsa men were sentenced Friday to lengthy prison terms after being found guilty in a multi-million dollar stock-fraud conspiracy, however a federal judge opted not to put them behind bars for life as he could have under applicable sentencing guidelines.

George David Gordon, 48, was ordered by U.S. District Judge James Payne to serve 15 years and 8 months in prison while Richard “Rick” Clark, 62, was given a 12 year, seven-month term.

Both men will be expected to contribute towards more than $6.1 million in restitution and to serve three years under court supervision after their eventual release from prison.

Payne had already issued a written order that contained a criminal forfeiture judgment against Gordon and Clark for more than $43.9 million.

The amount--specifically $43,927,809.95---is meant to represent stock sale proceeds traceable to the conspiracy that the jury found existed when it returned its guilty verdict, which was reached on May 3.

Also in the same Sept. 15 order, Payne entered another criminal forfeiture judgment against Gordon for more than $2.7 million, an amount related to a wire fraud charge of which Gordon was also convicted.

Gordon and Clark were among five men who were indicted in the case Jan. 15, 2009. They were accused of plotting from 2004 through 2006 to “pump up” the stock of three companies and then dump the stocks quickly at the expense of investors.

The two also were convicted of related crimes such as wire fraud, securities fraud and money laundering, although Clark was found not guilty of several counts, as well.

Gordon also was found guilty of obstructing justice and making a false statement in a matter within the jurisdiction of the U.S. Securities and Exchange Commission.

Federal sentencing guidelines would have allowed Payne to sentence Gordon and Clark to life in prison. However, Payne announced Friday that he would vary from the span recommended under the guidelines, which are advisory and not mandatory, Payne pointed out that following the originally recommended guideline punishment would have resulted in the two receiving a sentence greater than is often imposed in the nation’s courts for violent and or deadly crimes.

Even in the universe of financial crimes, Payne pointed out that major figures in the WorldCom and Enron scandals did not receive life sentences.

While Payne said the offenses of which Gordon and Clark were convicted were serious, he said they were simply “not in the same league” as the WorldCom and Enron scandals, both of which shook the financial markets.

Clark said nothing to the court during his Friday afternoon sentencing hearing. However, Gordon did apologize during his separate Friday morning hearing to his family as well as to any investors who have experienced “anguish and pain” due to his actions and to the Oklahoma Bar Association.

A Missouri business owner who claimed his company had assets that would make it the second biggest corporation in America has been charged with securities fraud and aggravated currency structuring.

Federal prosecutors said Wednesday that Petro America Corp., owned by Isreal Owen Hawkins, had no income other than investor money, no prospects for fulfilling its promises and only one full-time employee -- Hawkins. And instead of being worth more than $284 billion, as Hawkins claimed, Petro America's interests in gold mines and oil trading operations were worthless, investigators said.

"A federal criminal complaint alleges that Petro America was an empty facade of a business run by deception and false promises," U.S. Attorney Beth Phillips said Wednesday at a news conference. "Petro's founder is charged with defrauding unwary investors by selling them worthless stock in order to support his lavish lifestyle."

The criminal action comes on the heels of a civil complaint filed Friday seeking seizure of bank accounts and luxury items from Hawkins and other "unindicted co-conspirators."

Phillips didn't say Wednesday whether anyone else would be charged in the case.

Prosecutors said Hawkins, 55, of Kansas City, Kan., started selling unregistered stock to investors in 2008 at a cost of $100 per 100,000 shares, promising them that "book value" of the stock would be $2 per share when the company went public.

U.S. lenders already facing intense scrutiny from lawmakers and regulators over questionable foreclosure practices will likely face class-action lawsuits on behalf of thousands of homeowners nationwide.

Bruce Simon, a class-action attorney with Pearson Simon Warshaw & Penny LLP in San Francisco, said a filing from his firm is imminent, while two other prominent firms said they were also exploring filing class-actions.

So far, most of the courtroom activity over reports of shoddy documents used by lenders in foreclosure proceedings has come in the form of defenses mounted by individual homeowners, or limited class actions filed in state courts.

However, a lawsuit on behalf of homeowners nationwide could seek a court order that would suspend foreclosures much more broadly, class-action lawyers said.

"We are all hands on deck at the moment,'' said Simon of Pearson Simon Warshaw & Penny.

Another firm, Lieff Cabraser Heimann & Bernstein LLP, in San Francisco, is set to decide "within the next two weeks'' whether to file a lawsuit, according to Eric Fastiff, a partner there. He said the firm, which is on the steering committee for BP Plc oil spill litigation and also plays a leading role in lawsuits against Toyota Motor Corp over acceleration problems, currently has five attorneys and two paralegals assigned to the foreclosure issue.

The revelation that BP's Texas City refinery emitted toxic benzene for more than a month has ignited a furor in the port community that has suffered its share of deadly industrial accidents and toxic spills.

Thousands of residents who fear they may have been exposed to the known carcinogen released at the oil refinery from April 6 to May 16 have been flooding parking lots and conference halls where local trial attorneys hosted information sessions and sought clients for class-action lawsuits against the oil giant.

BP faces the new challenge just as it is reaching a key milestone in another crisis — plugging the Gulf of Mexico well that blew out in an oil spill disaster that is costing the company billions of dollars.

On Wednesday, more than 3,400 people lined the hallways and sidewalks around the Nessler Center to sign on to a $10 billion class-action lawsuit filed Tuesday in Galveston federal court by Friendswood attorney Anthony Buzbee.

The lawsuit alleges the release of 500,000 pounds of chemicals - including 17,000 pounds of benzene - has jeopardized the health and property values of people who live and work in the area. At the nearby College of the Mainland, a separate town hall meeting drew a crowd of 600.