Romeo Power Inc. was founded in 2016, and according to its SEC filings, purports to be an industry leading energy technology company focused on designing and manufacturing lithium-ion battery modules and packs for commercial electric vehicles. Romeo asserts that through its industry leading, energy dense battery modules and packs, it enables large-scale sustainable transportation by delivering safe, longer lasting batteries with shorter charge times. Romeo’s core product offering purportedly serves the battery electric vehicle (BEV) medium duty short haul and heavy duty long haul trucking markets, as well as specialty trucking and buses.
According to the Complaint, on February 12, 2019, RMG Acquisition Corp. (“RMG”), a New York City-based special purpose acquisition company, or SPAC, announced that it closed its initial public offering of 20 million units at $10 per share, resulting in gross proceeds of $200 million. On October 5, 2020, RMG announced a definitive agreement for a business combination with Romeo Power Inc. that would result in Romeo becoming a publicly listed company.
On December 29, 2020, Romeo announced that it completed its business combination with RMG. The business combination was approved by RMG stockholders in a special meeting held on December 28, 2020 and consummated on December 29, 2020.
The Complaint alleges that during the Class Period, unknown to investors, Romeo was suffering from an acute shortage of high quality battery cells, which are key raw materials for Romeo’s battery packs and modules, due to supply constraints. The Complaint further alleges that contrary to Defendants’ representations, (i) Romeo had only two battery cell suppliers, not four, (ii) the future potential risks that Defendants warned of concerning supply disruption or shortage had already occurred and were already negatively affecting Romeo’s business, operations and prospects, (iii) Romeo did not have the battery cell inventory to accommodate end-user demand and ramp up production in 2021, (iv) Romeo’s supply constraint was a material hindrance to Romeo’s revenue growth, and (v) Romeo’s supply chain for battery cells was not hedged, but in fact, was totally at risk and beholden to just two battery cell suppliers and the spot market for their 2021 inventory, and that Defendants failed to disclose these material facts to investors.
On July 15, 2021, the Court issued an Order consolidating cases and appointing Lead Plaintiff and Counsel. All future docketing was ordered to be done in the lead case 21-CV-03362.
Lead Plaintiff filed an amended Complaint on September 15, 2021. Defendants filed a Motion to Dismiss the amended Complaint on November 5. On June 2, 2022, the Court issued an Order granting in part and denying in part Defendants' Motion to dismiss. One of the claims and seven of the individual Defendants were dismissed from the case.
Lead Plaintiff filed a second amended Complaint on January 17, 2023.
On August 9, 2023, the parties notified the Court that they had reached a settlement agreement in principle. The parties entered into a Stipulation and Agreement of Settlement on December 7. On January 30, 2024, the Court granted preliminary approval of the Settlement. On July 17, Plaintiffs filed a Motion for Default Judgment against Romeo. On August 1, the Court granted final approval of the Settlement, including an award of Attorneys’ Fees and Expenses, and entered Final Judgment.
On September 19, 2024, the Court issued an Order granting Plaintiffs' Motion for Default Judgment. The Court also granted Plaintiffs' request for damages. The Court issued a Class Distribution Order on December 9.
