NEW YORK, August 4, 2021 / PRNewswire / – Pomerantz LLP Announces Class Action Lawsuit Against Stable Road Acquisition Corp. (“Stable Road” or the “Company”) (NASDAQ: SRAC; SRACW; SRACU) and certain of its officers. The class action, filed in United States District Court of the Central District of California, and registered as 21-cv-06287, is in the name of all purchasers of Stable Road securities (the “Class”) between October 7, 2020 and July 13, 2021, inclusive (the “Class Period”), seeking to recover damages caused by Defendants violating federal securities laws and to pursue remedies under Sections 10 (b) and 20 (a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated by virtue of it, against the Company and certain of its senior executives.
If you are a shareholder who purchased or otherwise acquired Stable Road securities during the Class Period, you have up to September 13, 2021 ask the court to appoint you as the principal plaintiff for the class. A copy of the complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby To [email protected] or 888.476.6529 (or 888.4-POMLAW), toll free, Ext. 7980. Those inquiring by e-mail are encouraged to provide their mailing address, telephone number and the number of shares purchased.
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Stable Road was started as a Special Purpose Acquisition Company, or “SPAC”.
October 7, 2020, Stable Road and Momentus Inc. (“Momentus”), a target acquisition of Stable Road, issued a joint press release announcing that the Company has agreed to acquire Momentus as part of a proposed merger, under subject to shareholder approval (the “Merger”). Although outside the target industry claimed by Stable Road, the press release said the merger “would create the first publicly traded space infrastructure company at the forefront of the new space economy.” The statement also stated that “[i]n 2019, the Company successfully tested its water plasma propulsion technology in space. ”
On October 13, 2020, Stable Road has filed with the Securities and Exchange Commission (“SEC”) on Form 8-K a presentation to investors regarding the merger. The investor presentation indicated that Momentus had an enterprise value of $ 1.2 billion and declared that its “revolutionary water propulsion technology” had been “”[s]tested successfully. . . on a demonstration flight launched in mid-2019. The investor presentation also highlighted Momentus’ ‘exceptional team’ led by the company’s’ visionary founder ‘, the defendant. Mikhail Kokorich.
On November 2, 2020, Stable Road has filed with the SEC a registration statement on Form S-4 for the shares to be issued under the merger (“registration statement”). The registration statement highlighted Momentus’ “valuable intellectual property” and stated in a relevant part: “Since its founding in 2017, Momentus has developed a portfolio of technologies, including its water plasma propulsion technology, cornerstone, which she successfully tested in space in 2019. ”The registration statement also showed Momentus was on track to achieve $ 19 million in turnover in 2021, which should reach $ 152 million in revenue by 2022 and more $ 4 billion income by 2027. Additionally, although the registration statement indicates that Momentus was considered a “foreign person” by the Committee on Foreign Investment in United States and therefore subjected to a national security review, he failed to disclose that the accused Kokorich himself was viewed by US government officials as a serious threat to national security, thus compromising the timing of Momentus’ launch and undermining its revenue forecasts.
The complaint alleges that, throughout the Claim Period, the Defendants made materially false and / or misleading statements, and failed to disclose material adverse facts regarding the business, operations, prospects and activities of due diligence of Stable Road in connection with the Fusion, which was known to the defendants or recklessly ignored by them, as follows: (i) that Momentus’ 2019 test of its key technology, a water plasma thruster, had not met Momentus’ own public and internal criteria for success prior to launch, and was conducted on a prototype that was not designed to generate commercially significant amounts of thrust; (ii) that the US government had indicated that it viewed the CEO of Momentus, the accused Kokorich, as a threat to national security, which undermined the continued leadership of the accused Kokorich on the launch schedule and prospects Momentus sales; (iii) that, due to (i) and (ii) above, the revenue projections and the business and operational plans provided to investors regarding Momentus and the business viability and timing of its products were materially false and misleading and lacked a reasonable basis In reality; and (iv) that Stable Road failed to perform proper due diligence on Momentus and its business operations and that the Defendants significantly misrepresented the due diligence activities carried out by the management of Stable Road in connection with the Merger.
On January 25, 2021, Momentus announced that the accused Kokorich had resigned as CEO of Momentus “in an effort to expedite the resolution of the US government’s national security and foreign property issues surrounding the company.”
On this news, the Stable Road Class A share price fell $ 4.75 over three trading days, or 19%, to close at $ 20.10 per share on January 27, 2021.
On July 13, 2021, the SEC announced charges against Stable Road, SRC-NI Holdings, Momentus, the defendant Brian Kabot and the defendant Kokorich for making “misleading claims about Momentus’ technology and the national security risks associated with Kokorich.” The statement said that all parties other than the accused Kokorich had settled the charges against them for $ 8 million in total, while the case against the defendant Kokorich continued.
Also on July 13, 2021, the SEC issued a cease and desist order and a lawsuit against Defendant Kokorich which detailed the Defendants’ plan to defraud investors in connection with the Merger.
On this news, the Stable Road Class A share price fell $ 1.22 per share, or 10%, to close at $ 10.66 per share on July 14, 2021.
Pomerantz LLP, with offices in new York, Chicago, Los Angeles, Paris, and Tel Aviv, is recognized as one of the leading firms in the areas of corporate, securities and antitrust litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class actions bar, Pomerantz was a pioneer in the field of securities class actions. Today, more than 85 years later, Pomerantz continues the tradition he established, fighting for the rights of victims of securities fraud, breach of fiduciary duty and professional misconduct. The firm has recovered numerous multi-million dollar damages on behalf of the members of the group. See www.pomlaw.com.
Robert S. Willoughby
888-476-6529 ext 7980
SOURCE Pomerantz LLP