Middle District of Florida Denies Motion to Dismiss Securities Class Action Against Autonomous Vehicle Tech Company
Case: Alms v. Luminar Technologies, Inc., No. 6:23-cv-982 (M.D. Fla. filed May 26, 2023)
Shareholders filed a securities class action against Luminar, an autonomous vehicle technology company, and its CEO. They alleged violations of § 10(b) and § 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5, claiming the company misled investors about its new technology’s costs and progress. Specifically, the plaintiffs said that a presentation to investors included an image of a competitor’s much more advanced photonic integrated circuit (PIC) microchip, implying Luminar’s chip was similarly sophisticated. After a Forbes article revealed the discrepancy, Luminar’s stock allegedly dropped, causing investor losses.
Luminar had previously succeeded in getting earlier versions of the complaint dismissed for failing to adequately plead materiality (i.e. that the misleading statement would matter to a reasonable investor) and scienter (i.e. knowledge or reckless disregard of the falsehood). The plaintiffs then filed a third amended complaint, adding facts from a confidential witness (a senior assistant who helped the CEO with the investor presentation) and an expert in electronics and photonics. The Court denied Luminar’s motion to dismiss this version, finding that the new allegations sufficiently alleged both that the image was material and that the CEO likely had knowledge (or should have known) that it was misleading.
