Lucid is facing a new legal battle after a federal judge certified a class of shareholders suing the EV maker and former CEO Peter Rawlinson over the company’s 2022 production forecasts.
The decision was issued last Friday by U.S. District Judge Araceli Martínez-Olguín in the Northern District of California. According to Law360, the class includes investors who purchased or acquired Lucid common stock between November 15, 2021, and August 3, 2022.
Sweden’s state pension fund Sjunde AP-Fonden (AP7) will serve as the class representative.
The lawsuit centres around Lucid’s original forecast to produce 20,000 vehicles in 2022. Investors allege Rawlinson continued publicly backing that target despite internal problems with logistics, inventory management and production of the Lucid Air.
“We remain confident in our ability to achieve 20,000 units in 2022,” Rawlinson said when Lucid released its third-quarter results on November 15, 2021.
Lucid later cut that target substantially. In February 2022, the company lowered its forecast to between 12,000 and 14,000 vehicles. It was reduced again in August to between 6,000 and 7,000, with Lucid acknowledging at the time that “the limitations of our logistics system have compounded the challenge.”
Lucid ultimately produced 7,180 vehicles during 2022.
Lucid had argued that the November 2021 comments simply repeated information already known to investors and therefore had no impact on the share price. The judge rejected that argument, writing that “updates and estimates for project timelines are almost always new information.”
Class certification does not mean the court has determined Lucid or Rawlinson misled investors. The allegations remain unproven, and the ruling makes no finding on whether the statements at the centre of the case were false.
The case is also separate from a more recent securities lawsuit against Lucid involving the Gravity SUV. That lawsuit alleges the company failed to adequately disclose supplier problems that resulted in a 29-day disruption to Gravity deliveries earlier this year.
Lucid has until October 9 to ask the Ninth Circuit for permission to appeal the class certification decision.
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