Rivian Failed To Disclose Price Hike Plans To Investors, Lawsuit Alleges

Rivian Automotive Inc RIVN may have rolled back price hikes after widespread online backlash, but that episode has now drawn a shareholder lawsuit, protocol.com reported on Tuesday, citing court filings.

What Happened: The lawsuit, filed by shareholder Charles Crews on Monday in a California U.S. District Court, alleges the recently listed company misled investors by not disclosing it would raise prices of its electric vehicles after going public.

The company did not respond to Benzinga’s request for comment outside of business hours.

Rivian is expected to report fourth-quarter numbers on Thursday.

See Also: Rivian Faces Growing Online Backlash After Increasing Car Prices, Thousands Claim To Cancel Orders

The Backstory: Crews has alleged that Rivian failed to disclose the potential damages stemming from its price hikes of its R1T and R1S electric cars, according to the report. He had bought 35 shares in Rivian on its first day of trading in November at around $113 each. 

Rivian had last week faced an onslaught of peeved customers online, with many claiming to cancel reservations on web forums after the electric vehicle maker announced it would raise prices.

CEO RJ Scaringe apologized two days later and rolled back the hikes, which the company attributed to inflationary pressure and soaring component costs, among other reasons.

See Also: Rivian Missed 2021 Production Targets And Is Now Reportedly Bumping Up Prices

Rivian made a stellar market debut in November, but its shares have tumbled nearly 46% from its IPO price of $78, as it grappled with supply chain woes and a global chip crunch that forced it to delay production.

It counts Amazon.com Inc AMZN and Ford Motor Co F among its key investors.

Price Action: Rivian stock closed 0.5% lower at $42.2 a share on Tuesday. The stock is down 59% year-to-date.