Nikola, a company that calls itself a pioneer in electric vehicles, has been accused of deception by a Hindenburg Research report. The report refers specifically to videos created to make prototype vehicles appear fully functional, and other alleged deceptions about the status and efficacy of its newest tech. Could a shareholder class action be forthcoming?
An LFJ Conversation with Michael Kelley, Partner, Parker Poe
Nikola, a company that calls itself a pioneer in electric vehicles, has been accused of deception by a Hindenburg Research report. The report refers specifically to videos created to make prototype vehicles appear fully functional, and other alleged deceptions about the status and efficacy of its newest tech. Could a shareholder class action be forthcoming?
The Detroit News explains that Nikola has been accused of making dozens of untrue statements regarding its products, partnerships, or capabilities. One video referenced in the report shows a prototype of a truck that was portrayed as fully functional back in 2016. In fact, the truck in the video had been towed to the top of a hill, then allowed to roll down.
This report comes on the heels of news that General Motors recently acquired a $2 billion equity stake in Nikola. GM has agreed to manufacture several specific components for the Badger; Nikola’s upcoming electric pickup truck.
Though they are still considered a startup, Nikola has the kind of deep pockets that experienced litigation funders look for when vetting potential cases. The available facts certainly point to disappointed shareholders impacted by deception.
