Edelson Lechtzin LLP is Investigating Securities Fraud Claims on Behalf of Carvana
NEWTOWN, PA, August 9, 2022 — The law firm of Edelson Lechtzin LLP is investigating securities fraud claims on behalf of all purchasers of Carvana Co. (“Carvana” or the “Company”) (NYSE: CVNA) between May 6, 2020, and June 24, 2022, inclusive (the “Class Period”). The Carvana class action lawsuit was filed in the United States District Court for the District of New Jersey and seeks a recovery of damages caused by violations of the Securities Exchange Act of 1934 (the “Exchange Act”).
Investors who purchased Carvana common stock during the Class Period may move the U.S. District Court for the District of New Jersey to appoint them as lead plaintiff no later than October 3, 2022. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. Investors who wish to discuss the lead plaintiff selection process should contact Edelson Lechtzin LLP, toll free at 844-696-7492, or by e-mail at [email protected]. A copy of the class action complaint can be viewed on Edelson Lechtzin LLP‘s website at www.edelson-law.com or HERE.
Background on the Carvana Securities Class Action
Carvana is an e-commerce platform for buying and selling used cars in the United States.
The Carvana class action lawsuit alleges that, throughout the Class Period, defendants made false and/or misleading statements and failed to disclose that:
- Carvana faced serious ongoing problems with documentation, registration and of title with many of its vehicles;
- as a result, Carvana was issuing unusually frequent temporary plates;
- Carvana regularly violated laws and regulations in many of its markets;
- as a result, Carvana risked its ability to continue or expand operations in existing markets and was at an increased risk of investigation and government action;
- Carvana was engaged in ongoing negotiations with various state and local authorities regarding its alleged illegal business tactics mentioned above; and
- Carvana was facing impending regulatory actions including license suspensions, business cessation, and/or probation in several states including Arizona, Illinois, Pennsylvania, Michigan, and North Carolina.
On June 24, 2022, Barron’s published an article entitled: “Carvana Sought to Disrupt Auto Sales. It Delivered Undrivable Cars,” which elaborated on the Company’s regulatory issues. The article says, “In its haste to seize market share from competitors, Carvana sold cars before they were registered to their new owners” and “at one point forming an ad hoc unit known as the ‘undriveable-car task force.’” It continues, “In other instances…Carvana sold cars before it had title to the vehicles, an action that is illegal in many states where the company does business.” As a result, Baron’s warned, “State regulators across the U.S. have been subjecting Carvana to suspensions or increased oversight over registration delays and its practice of issuing multiple temporary license plates from states where it has dealer’s licenses, instead of promptly providing permanent ones.”
On this news, the price of Carvana’s shares plummeted $6.78 per share, or 21%, over the next two trading days, to close at $24.74 per share on June 28, 2022, damaging investors.
About Edelson Lechtzin LLP
Edelson Lechtzin LLP is a national class action law firm with offices in Pennsylvania and California. In addition to cases involving securities and investment fraud, our lawyers focus on class and collective litigation in cases alleging violations of the federal antitrust laws, employee benefit plans under ERISA, wage theft and unpaid overtime, consumer fraud, and dangerous and defective drugs and medical devices.
For more information, please contact:
Marc H. Edelson, Esq.
Eric Lechtzin, Esq.
Edelson Lechtzin LLP
411 S. State Street, Suite N-300
Newtown, PA 18940
Phone: 844-696-7492 or 215-867-2399 ext. 1
Email: [email protected]