Mullen Automotive (MULN) $7.25M Investor Settlement
Overview
The lawsuit claims Mullen made false statements about its EV production abilities and partnerships. These alleged misrepresentations caused the company's stock to be artificially inflated, resulting in significant financial losses for investors.
Timeline
June 15, 2020: Mullen announced a merger with Net Element, Inc., claiming it could soon launch the Dragonfly K50 luxury sports car and other EV models.
2020-2021: Mullen continued to make optimistic statements about its production capabilities and partnerships, including plans to release the Dragonfly K50 and an electric SUV, the MX-05.
April 6, 2022: Hindenburg Research published a report alleging that Mullen's production claims were unfounded and that the company lacked the capacity to meet its stated goals. This led to a 10% drop in the company's stock price.
Background
Mullen Automotive positioned itself as a promising new entrant in the EV market, with plans to introduce several electric vehicle models.
However, a report from Hindenburg Research cast doubt on the company's actual capabilities and raised concerns about misleading statements made to investors.
The report revealed that Mullen’s claims of revolutionary battery technology and imminent vehicle production were greatly exaggerated.
It also indicated that the company misrepresented its agreements with partners like Qiantu Motors and used stock photos to falsely portray its manufacturing abilities.
What Investors Should Know
Mullen Automotive has agreed to settle for $7.25 million to resolve all allegations of misleading statements and exaggerated claims regarding its EV production capabilities.
Investors who suffered losses during the class period can file for a payout from the settlement fund.
Frequently Asked Questions
All persons who purchased or otherwise acquired the publicly traded common stock of Mullen Automotive or Net Element, publicly traded call options and/or put options on such stock, during the period from June 15, 2020 to April 17, 2022, both dates inclusive.
No, if you have purchased securities within the class period, you are eligible to participate.
You can participate in the settlement and retain (or sell) your securities.
The entire process usually takes 4 to 9 months after the claim deadline. But the exact timing depends on the court and settlement administration.
The final payout amount depends on your specific trades and the number of investors participating in the settlement.
If 100% of investors file their claims - the average payout will be $0.03 per share. Although typically only 25% of investors file claims, in this case, the average recovery will be $0.12 per share.
11thestate is an investor recovery company, we help investors to track and collect securities class action settlements. We will:
Prepare documents for your payout
Audit the claim and make sure you get the maximum possible payout
File a claim with the settlement administration
Correspond with the settlement administration to resolve emerging issues
Deliver payout directly to your brokerage account
There is no upfront cost, but we will deduct 20% of the recovered amount as a commission for our services.