A federal judge has partially dismissed investor claims against Lucid Group Inc. and its former CEO, Peter Rawlinson, alleging that the electric vehicle manufacturer concealed the impact of internal logistical issues on its production targets. Judge Araceli Martínez-Olguín ruled that the lead plaintiff, Sjunde AP-Fonden, could proceed with claims based on four misstatements made by Rawlinson regarding Lucid’s manufacturing capacity. These statements allegedly downplayed production problems by attributing them to industry-wide supply chain issues and pandemic-related challenges. However, the judge found that the plaintiff failed to adequately demonstrate that Rawlinson knew his other statements about meeting 2022 production targets and delays were false at the time they were made. The case will continue based on the four adequately alleged misstatements.
Background
Lucid Group Inc. has been under scrutiny from investors regarding its production capabilities and the factors affecting its targets. The company’s former CEO, Peter Rawlinson, had made several statements about the company’s manufacturing capacity and production timeline. Investors alleged that these statements were misleading as they did not accurately reflect the internal logistical challenges faced by the company.
Judge’s Ruling
Judge Martínez-Olguín’s decision allows the lead plaintiff to pursue claims related to Rawlinson’s statements about Lucid’s manufacturing capacity. The judge noted that these statements were made in a context that could be seen as casting production problems as industry-wide issues rather than specific to Lucid. However, the court dismissed claims related to other statements made by Rawlinson about meeting production targets and delays, citing a lack of evidence that he knew these statements were false when made.
Implications
The partial dismissal is a significant development in the legal proceedings against Lucid Group Inc. and its former CEO. The outcome of the case could have implications for how electric vehicle manufacturers disclose production challenges and the impact of internal logistical issues on their targets. As the case continues, it will be closely watched by investors and industry observers.
