SAN DIEGO, Aug. 08, 2022 (GLOBE NEWSWIRE) -- Robbins Geller Rudman & Dowd LLP announces that purchasers or acquirers of Carvana Co. (NYSE: CVNA) publicly traded securities between May 6, 2020 and June 24, 2022, both dates inclusive (the “Class Period”) have until October 3, 2022 to seek appointment as lead plaintiff in the Carvana class action lawsuit. Captioned Brent v. Carvana Co., No. 22-cv-04870 (D.N.J.), the Carvana class action lawsuit charges Carvana and certain of its top executive officers with violations of the Securities Exchange Act of 1934.
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CASE ALLEGATIONS: Carvana provides 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 misleading statements and failed to disclose that: (i) Carvana faced serious, ongoing issues with documentation, registration, and title with many of its vehicles; (ii) as a result, Carvana was issuing unusually frequent temporary plates; (iii) thus, Carvana was violating laws and regulations in many existing markets; (iv) consequently, Carvana risked its ability to continue business and/or expand its business in existing markets; (v) as such, Carvana was at an increased risk of governmental investigation and action; (vi) Carvana was in discussion with state and local authorities regarding the above-stated business tactics and issues; and (vii) Carvana was facing imminent and ongoing regulatory actions including license suspensions, business cessation, and probation in several states and counties including in 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 Undriveable Cars,” detailing, among other things, that: “[i]n its haste to seize market share from competitors, Carvana was selling cars faster than it could get them registered to their new owners” and “at one point forming an ad hoc unit known as the ‘undriveable-car task force’”; “[i]n 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”; and “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.” For example, the article detailed that “Pennsylvania officials suspended [Carvana’s] license to issue temporary permits at its two vending-machine towers in that state . . . citing late document submittals, ‘improper issuance and verification of temporary Pennsylvania plates in other states,’ and other violations.” On this news, Carvana’s share price fell approximately 21% over the next two trading days, damaging investors.
THE LEAD PLAINTIFF PROCESS: The Private Securities Litigation Reform Act of 1995 permits any investor who purchased or acquired Carvana publicly traded securities during the Class Period to seek appointment as lead plaintiff. A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class. A lead plaintiff acts on behalf of all other class members in directing the Carvana class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Carvana class action lawsuit. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff of the Carvana class action lawsuit.
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