INVESTOR ALERT: Edelson Lechtzin LLP is Investigating Securities Fraud Claims on Behalf of Electric Last Mile Solutions, Inc. (NASDAQ: ELMSQ) Shareholders
NEWTOWN, PA, June 23, 2023 — The law firm of Edelson Lechtzin LLP urges purchasers of Electric Last Mile Solutions (“ELMS” or the “Company”) (NASDAQ: ELMSQ) common stock to consult an experienced securities fraud attorney about the private investment in public equity (“PIPE”) offering conducted by Electric Last Mile on or about December 10, 2020.
Investors who purchased Electric Last Mile Solutions, Inc. common stock may move the U.S. District Court for the District of Delaware to appoint them as lead plaintiff, no later than August 14, 2023. Please contact Edelson Lechtzin LLP at 844-696-7492 to discuss your investment losses, or by e-mail at [email protected]. A copy of the class action complaint can be viewed HERE.
Background on Last Mile Solutions, Inc.
Electric Last Mile Solutions was a company that produced commercial electric vehicles with the aim of ushering in a new era where commercial vehicles are environmentally friendly and customized to improve business efficiency and profitability. They have since filed for bankruptcy. Their first product, the Urban Delivery, was expected to be the first Class 1 commercial electric vehicle available in the United States. Prior to its delisting, ELMS was a publicly traded company created through the June 25, 2021 merger of a privately held company called Electric Last Mile, Inc. (“ELM”) and a publicly traded special purpose acquisition company (“SPAC”), then called Forum Merger III Corporation (“FIII”).
The Securities Fraud Claims
The complaint alleges, that throughout the Class Period, Defendants made materially false and/or misleading statements regarding the Company’s business, operations, and prospects and/or failed to disclose that: (i) Before the PIPE Offering, Jason Luo, James Taylor, and other senior members of Electric Last Mile’s management bought Electric Last Mile common stock at prices significantly lower than its market value; (ii) Electric Last Mile failed to properly record the compensation expense for the pre-PIPE Offering transactions, which resulted in a discrepancy between the fair market value of the common stock sold and the amount actually paid.; (iii) the failure to record compensation expenses from pre-PIPE Offering transactions caused Electric Last Mile’s year-end 2020 financial performance to be significantly overstated, resulting in expenses, net loss, and shareholders’ deficit being understated; (iv) as a result, Electric Mile’s historical financial statements could no longer be relied upon and would need to be restated. The financial statements of Electric Last Mile, which were included in proxy statements, were not created in compliance with Generally Accepted Accounting Principles, and BDO, the Company’s independent audit firm, had failed to follow applicable rules and regulations regarding auditor independence in auditing the Company’s historical financials provided in proxy statements.
On March 11, 2022, ELMS confirmed an ongoing SEC investigation and disclosed that it was withdrawing its previous financial guidance and that it would need to raise additional capital to launch its vehicles. On this news, the price of ELMS common stock fell 48%, trading below $1 per share.
ELMS announced on June 13, 2022, their intention to liquidate under a Ch. 7 bankruptcy. Since February 2022, the company has been operating without an independent audit firm and has not kept up with its financial filings. This has caused them to be non-compliant with NASDAQ listing rules, resulting in the delisting of their stock, which is now essentially worthless, damaging investors.
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]
Email: [email protected]
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.
This press release may be considered Attorney Advertising in some jurisdictions. No class has been certified in this case, so you are not represented by counsel unless you retain one. You may select counsel of your choice. You may also remain an absent class member and do nothing at this point. Your ability to share in any potential future recovery is not dependent upon serving as lead plaintiff.