LOS ANGELES--(BUSINESS WIRE)--The Law Offices of Frank R. Cruz announces that it has filed a class action lawsuit in the United States District Court for the Central District of California captioned Hall v. Stable Road Acquisition Corp., et al., (Case No. 21-5943) on behalf of persons and entities that purchased or otherwise acquired Stable Road Acquisition Corp. (“Stable Road” or the “Company”) (NASDAQ: SRAC, SRACW, SRACU) securities between October 7, 2020 and July 13, 2021, inclusive (the “Class Period”). Plaintiff pursues claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”).
Investors are hereby notified that they have until September 13, 2021 to move the Court to serve as lead plaintiff in this action.
If you are a shareholder who suffered a loss, click here to participate.
Stable Road is a special purpose acquisition company (“SPAC”). Momentus Inc. (“Momentus”) is currently a private company.
On October 7, 2020, Momentus announced that it had signed a definitive merger agreement with Stable Road, resulting in Momentus becoming a publicly traded entity. The transaction was initially valued at $1.13 billion, but was later cut to $466.6 million in June 2021 due to delays in the company’s first commercial launch.
On January 4, 2021, Stable Road revealed that Momentus’s January 2021 launch would be “remanifest[ed] . . . to a subsequent launch opportunity in 2021” because the company needed additional time to obtain the necessary regulatory approvals.
On this news, the Company’s stock price fell $1.71, or 9.5%, over two consecutive trading sessions to close at $16.25 per share on January 5, 2021, on unusually heavy trading volume.
On January 25, 2021, Momentus announced that Kokorich had resigned from the company. The press release also stated that Momentus, in consultation with Stable Road “determined that accepting Mr. Kokorich’s resignation is in the best interest of the Company, in an effort to expedite the resolution of U.S. government national security and foreign ownership concerns surrounding the Company, the existence of which the Company has recently confirmed.”
On this news, the Company’s stock price fell $4.75, or 19%, over three consecutive trading sessions to close at $20.10 per share on January 27, 2021.
On May 24, 2021, Stable Road disclosed that Momentus “does not expect to fly any missions in 2021” because it was still securing regulatory approvals.
On this news, the Company’s share price fell $1.61, or approximately 14%, to close at $10.42 per share on May 24, 2021, on unusually heavy trading volume.
On July 13, 2021, after market hours, the SEC announced a settlement for penalties exceeding $8 million with Stable Road; its sponsor SRC-NI; Stable Road’s Chief Executive Officer, Brian Kabot; and its merger target Momentus. The charges relate to misleading claims about Momentus’s technology and about national security risks associated with Mikhail Kokorich (“Kokorich”), Momentus’s founder and former CEO. According to the SEC’s charges, Stable Road had repeated Momentus’s misleading claims that it had “‘successfully tested’ its propulsion technology in space when, in fact, the company’s only in-space test had failed to achieve its primary mission objectives or demonstrate the technology’s commercial viability.”
On this news, the Company’s share price fell $1.20, or over 10%, to close at $10.68 per share on July 14, 2021, on unusually heavy trading volume.
Throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that Momentus had only conducted a single in-space test, which did not meet any of Momentus’s pre-launch evaluation criteria, thus the company had not “successfully tested” its technology; (2) that the sole in-space test conducted by Momentus was never designed to test the commercial viability of the company’s thrusters; (3) that, as a result, Momentus’s progress in commercializing its technology was significantly overstated; (4) that Kokorich had been informed that the U.S. Government considered him to be a “threat” that caused his affiliation with another space technology company to be a risk to national security; (5) that, because Kokorich was considered a national security risk, Momentus would face challenges obtaining the necessary licenses and approvals for its commercial launches; (6) that, as a result, Kokorich’s affiliation with Momentus jeopardized, among other things, the company’s launch schedule and revenue projections which were based on assumptions about the timing of the company’s first commercial launch; (7) that Stable Road had not conducted adequate due diligence, including as it relates to Momentus’s testing progress and national security concerns with Momentus’s CEO; (8) that, as a result of the failure to disclose the foregoing, Stable Road was reasonably likely to face regulatory scrutiny; and (9) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
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If you purchased Stable Road securities during the Class Period, you may move the Court no later than September 13, 2021 to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you purchased Stable Road securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Frank R. Cruz, of The Law Offices of Frank R. Cruz, 1999 Avenue of the Stars, Suite 1100, Los Angeles, California 90067 at 310-914-5007, by email to info@frankcruzlaw.com, or visit our website at www.frankcruzlaw.com. If you inquire by email please include your mailing address, telephone number, and number of shares purchased.
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