A securities class action has been filed against Volkswagen AG (VWAGY) on behalf of persons or entities who purchased or otherwise acquired publicly traded Volkswagen securities between March 29, 2021 through March 30, 2021. This case has been filed in the USDC – C.D.CA.
The Complaint alleges that on March 29, 2021, CNBC published an article entitled “VW accidentally leaks new name for its U.S. operations: Voltswagen” stating that “Volkswagen is expected to change the name of its operations in the U.S. to ‘Voltswagen of America,’ emphasizing the German automaker’s electric vehicle efforts” and that “[a] now unpublished press release called the change a ‘public declaration of the company’s future-forward investment in e-mobility.’”
Then on March 30, 2021, the Wall Street Journal published an article entitled “No, Volkswagen Isn’t Rebranding Itself Voltswagen” which stated “[t]he name change stunt comes as the company is eager to get U.S. consumers jazzed about the ID. 4, which went on sale in U.S. showrooms this month.” The article also stated that “problem for VW is that everyone took it seriously, creating confusion about the company’s intentions and moving the shares[.]” Due to the earlier news, the article stated “[i]n the U.S., the company’s American depositary receipts rose as much as 12% Tuesday before sliding near the close after the company confirmed the name change was a joke, closing up 9%.”
On this news, Volkswagen’s American depositary receipt (“ADR”) price fell $2.17 per ADR, or 5%, over the next two trading days to close at $35.58 per ADR on April 1, 2021, damaging investors.