Notice is hereby given that a class action lawsuit has been filed on behalf of those who purchased or acquired Romeo Power, Inc. (“Romeo”) (NYSE: RMO; RMO.WT), f/k/a RMG Acquisition Corp. (“RMG”) (NYSE: RMG; RMG.U; RMG.WS) securities during the period October 5, 2020 through March 30, 2021, inclusive (the “Class Period”).
Romeo investors may receive additional information about the case by clicking the link "Submit Your Information" above.
Romeo is an energy technology company focused on designing and manufacturing lithium-ion battery modules and packs for commercial electric vehicles. RMG, a special purpose acquisition company, or SPAC, was formed for the purpose of entering into a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses in the diversified resources and industrial materials sectors. On October 5, 2020, RMG announced a definitive agreement for a business combination with Romeo. 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.
During the Class Period, the defendants represented that for 2020 Romeo estimated revenue of $11 million, and for 2021 Romeo estimated revenue of $140 million. The defendants further represented that Romeo had the capacity and supply to meet end-user demand for Romeo’s products, that Romeo was not beholden “to any level of the value chain”, that its supply was hedged, and that it did not see any material challenges that would hamper growth.
The truth was revealed on March 30, 2021 when, after the market closed, Romeo issued a press release and filed a report with the U.S. Securities and Exchange Commission on a Form 8-K that disclosed its financial results for the quarter and year ended December 31, 2020, and conducted a conference call with investors and analysts. The defendants shocked investors by disclosing that Romeo’s production had been hampered by a shortage in supply of battery cells and that its estimated 2021 revenue would therefore be reduced by approximately 71-87%. On March 31, 2021, Morgan Stanley issued a research report in which it downgraded Romeo’s target price per share from $12 to $7. Following this news, Romeo shares declined from a closing price on March 30, 2021 of $10.37 per share to close at $8.33 per share, a decline of $2.04 per share, or almost 20%.
The complaint alleges that throughout the Class Period, the defendants concealed that: (1) Romeo had only two battery cell suppliers, not four; (2) the future potential risks that the defendants warned of concerning supply disruption or shortage had already occurred and were already negatively affecting Romeo’s business, operations and prospects; (3) Romeo did not have the battery cell inventory to accommodate end-user demand and ramp up production in 2021; (4) Romeo’s supply constraint was a material hindrance to Romeo’s revenue growth; and (5) 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.
If you are a member of the class described above, you may no later than June 15, 2021 move the Court to serve as lead plaintiff of the class, if you so choose.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Filling out the online form above or communicating with any counsel is not necessary to participate or share in any recovery achieved in this case. Any member of the purported class may move the court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.
If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Kessler Topaz Meltzer & Check, LLP: James Maro, Esq. (484) 270-1453 or Adrienne Bell, Esq. (484) 270-1435; toll-free at (844) 887-9500; or via e-mail at firstname.lastname@example.org. If you would like additional information about the suit, please click on the link "Submit Your Information" above and fill out the form as promptly as possible.