Li Auto Inc Faces Securities Fraud Lawsuit Due to Alleged False Statements

TapTechNews May 16 news, according to the WeChat official account named 'International Lawyer', it is reported that 'Li Auto Inc (NASDAQ: LI) has recently been collectively sued by investors for securities fraud. In the current lawsuit, investors accused the company and some senior executives of making false statements during the litigation period, violating securities laws and causing losses to investors. Investors have applied to the court for an order to compensate investors for the losses caused by the defendant's illegal actions resulting in a decline in stock price.'

In the current collective lawsuit, investors accused the defendant of making false and/or misleading statements and/or failing to disclose throughout the litigation period: when Ideal launched its first electric battery vehicle model LiMEGA, it exaggerated the market demand for vehicles and the effectiveness of operational strategies; therefore, the company is unlikely to achieve the expected vehicle delivery volume in the first quarter of 2024; once disclosed, the above may have a significant negative impact on the company's financial condition; therefore, the company's public statements during the litigation period are significantly false and misleading.

According to Caixin, similar collective lawsuits are very common in the U.S. stock market. Ideal Auto stated that the accusations are groundless and will fully protect the interests of the company and shareholders.

Ideal Auto had high expectations for its first pure electric MPV model MEGA and set aggressive sales targets for it, but the model underperformed after its launch on March 1. Ideal Auto adjusted its first quarter and full year sales targets on March 21. From February 29 to March 21, Ideal Auto's stock price fell by 30%.

TapTechNews previously reported that, according to 21st Century Business Herald, it was learned from multiple independent sources that after the May Day holiday, Ideal is undergoing a new round of company-wide personnel optimization, with an overall optimization rate exceeding 18%. The 2023 financial report shows that Ideal Auto has nearly 31,600 employees, and based on the optimization rate, this round of optimization involves more than 5,600 people.