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Nikola Corporation

Company NameNikola Corporation
Stock SymbolNKLA
Class PeriodMarch 03, 2020 to September 20, 2020
Lead Plaintiff Motion DeadlineNovember 16, 2020

On September 10, 2020, Hindenburg Research published a report entitled “Nikola: How to Parlay an Ocean of Lies into a Partnership with the Largest Auto OEM in America.” Therein, Hindenburg alleged that the Company’s founder, Trevor Milton (“Milton”), had misled partners into signing agreements by falsely claiming to have extensive proprietary technology. Among other things, the report claimed that Milton had staged a video of Nikola’s semi-truck cruising down a road by filming the truck rolling down a hill and that, despite claiming Nikola designs all key components in house, the Company appears to simply be buying or licensing them from third-parties.

On this news, the Company’s share price fell $10.24, or 24%, over two consecutive trading sessions to close at $32.13 per share on September 11, 2020, thereby injuring investors.

On September 14, 2020, after the market closed, Bloomberg reported that the SEC was “examining” Nikola over the Hindenburg report’s allegations.

On September 15, 2020, before the market opened, Hindenburg published another report focusing on Nikola’s response, entitled “We View Nikola’s Response As a Tacit Admission of Securities Fraud[.]”

On this news, the Company’s share price fell $2.96, or 8%, to close at $32.83 per share on September 15, 2020, thereby injuring investors further.

On September 20, 2020, Nikola announced that Milton was stepping down from the Company.

On this news, the Company’s share price fell $6.61, or 19%, to close at $27.58 per share on September 21, 2020, thereby injuring investors further. 

The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors that: (1) VectoIQ did not engage in proper due diligence regarding its merger with Nikola; (2) Nikola overstated its “in-house” design, manufacturing, and testing capabilities; (3) Nikola overstated its hydrogen production capabilities; (4) as a result, Nikola overstated its ability to lower the cost of hydrogen fuel; (5) Nikola founder and Executive Chairman, Trevor Milton, tweeted a misleading “test” video of the Company’s Nikola Two truck; (6) the work experience and background of key Nikola employees, including Mr. Milton, had been overstated and obfuscated; (7) Nikola did not have five Tre trucks completed; and (8) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

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