Electric Last Mile Solutions (ELMSQ) Faces Shareholder Class Action Lawsuit: Johnson Fistel Encourages Investors to Seek Compensation for Alleged Wrongdoings
Johnson Fistel, LLP, a shareholder rights law firm, announces that a class action lawsuit has been filed on behalf of Electric Last Mile Solutions, Inc. (“Electric Last Mile” or “the Company”) (OTC PINK: ELMSQ) investors who acquired common stock directly in the private investment in public equity (“PIPE”) offering conducted by Electric Last Mile on or about December 10, 2020 (the “PIPE Offering”). If you are a shareholder who incurred losses during this period, you have until August 14, 2023, to move the court to become a lead plaintiff in this action.
As the Electric Last Mile class action lawsuit alleges, defendants made false and/or misleading statements and/or failed to disclose that: (i) defendants Jason Luo, James Taylor, and other senior members of Electric Last Mile’s management had acquired Electric Last Mile common stock at substantial discounts to market value in transactions completed before the PIPE Offering; (ii) the difference between the fair market value of the Electric Last Mile common stock sold in the pre-PIPE Offering transactions and the amount actually paid had not been properly recorded as compensation expense by Electric Last Mile; (iii) the failure to record compensation expenses stemming from the pre-PIPE Offering transactions had the effect of substantially inflating Electric Last Mile’s year-end 2020 financial performance and the pro forma year-end 2020 financial performance of the combined company, thereby understating expenses, net loss, and shareholders’ deficit; (iv) as a result, Electric Last Mile’s historical financial statements could no longer be relied upon and would need to be restated; (v) the Electric Last Mile historical financial statements provided in proxy statements were not prepared in accordance with Generally Accepted Accounting Principles; and (vi) BDO had failed to follow applicable laws, rules, and regulations regarding auditor independence in auditing the Electric Last Mile historical financials provided in proxy statements.
A lead plaintiff will act on behalf of all other class members in directing the class-action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the class-action lawsuit. An investor’s ability to share any potential future recovery of the class action lawsuit is not dependent upon serving as lead plaintiff.
Johnson Fistel, LLP is a shareholder rights law firm representing individual and institutional investors in shareholder derivative and securities class action lawsuits. For more information, visit their website http://www.johnsonfistel.com.
Johnson Fistel, LLP
Jim Baker, 619-814-4471