Hagens Berman and Portnoy Law firm are reaching out to Rivian investors as they prepare for lawsuits related to the EV company’s R1T and R1S price increase, which reportedly resulted in many customers canceling their preorders.
Hangens Berman has already filed a securities class action lawsuit and urges RIVN investors who suffered significant losses to submit their losses to the firm. Portnoy Law firm has not filed a lawsuit yet, but has initiated an investigation into possible securities fraud and may file a class action on behalf of investors.
Both law firms are investigating Rivian’s November 2021 $11.93 billion IPO, along with the company’s recent price increase. They allege that Rivian’s IPO offering documents were inaccurate, misleading, and/or incomplete. The justifications behind the allegations against Rivian are listed below.
- the R1T and R1S were underpriced to such a degree that Rivian would have to raise prices shortly after the IPO
- these price increases would tarnish Rivian’s reputation as a trustworthy and transparent company
- These price increases would put a significant number of the existing backlog of 55,400 preorders along with future preorders in jeopardy of cancelation.
Hagens Berman and Portnoy Law firm noted that Rivian raised the price of the R1T by 17% and the R1S by 20% on March 1, 2022. The price hikes would apply to nearly all preorders.
Rivian introduced the price hikes after launching the new Dual Motor variants for the R1T pickup truck and R1S SUV. It also announced a price increase for the Quad Motor variants of the R1T and R1S due to “price inflation of supplier components and raw materials.”
However, Rivian backtracked on its price increases by March 3, 2022. The company announced that it would honor all preorder pricing on R1T and R1S orders placed on or before March 1.
On March 1, 2022, RIVN’s stock price closed at $61.91. Rivian’s stock price has steadily declined since it announced price increases for the R1T and R1S. As of this writing, Rivian stock shares are $42.21. In November 2021, the company priced its IPO at $78 per share, and it opened 37% above initial pricing with a $93.3 billion market cap.