Almost 67,000 pages of documents. A vice chancellor who refused to throw the case out. And in the end, a $15 million number both sides could live with.

Archer Aviation stockholders have reached a proposed settlement in Delaware Chancery Court to resolve litigation accusing the backers of the SPAC that took the electric-aircraft company public of misleading investors and steering them into a $1.7 billion merger they didn't fully understand. The deal, filed Monday, still requires court approval before it becomes final.

How a SPAC Merger Turned Into a Lawsuit

The dispute traces back to Atlas Crest Investment Corp.'s merger with Archer Aviation, an electric aircraft developer. Atlas Crest agreed to the deal in February 2021, and stockholders approved it that September, with the transaction closing two days later and Atlas Crest formally becoming Archer Aviation Inc.

Before the merger closed, Atlas Crest investors had the option to redeem their shares rather than roll them into the new company. Roughly 24.2 million shares — about 48.5% of Atlas Crest's public float — were redeemed. The stockholders who didn't cash out, led by Sonal Singh, Saheem Kundapur and Josh Wortman, later sued, alleging the defendants breached their fiduciary duties, aided and abetted wrongdoing, and were unjustly enriched at their expense.

Central to their claims: that investors were given misleading information about Archer's aircraft development timeline and financial outlook — information that, they argued, prevented them from making a fully informed decision about whether to redeem their shares before the deadline.

A Case That Refused to Go Away

Unlike many SPAC-related suits that get dismissed early, this one didn't. Vice Chancellor Lori W. Will largely rejected a motion to dismiss in July 2025, allowing claims to proceed against Moelis and several other defendants — a ruling that pushed the case into full discovery rather than an early exit.

That discovery process turned out to be extensive. Defendants and third parties produced 3,294 documents spanning approximately 67,000 pages, the kind of document volume that typically signals both sides were preparing for a real fight, not a quick resolution.

Two Mediation Sessions, One Settlement

The parties first attempted mediation on June 4 with David Murphy of Phillips ADR Enterprises. That session ended without an agreement. But negotiations didn't stop there — the following day, both sides accepted a double-blind mediator's proposal that ultimately became the framework for the settlement now before the court.

In the stipulation, the plaintiffs said they still believe their claims have merit, but concluded the settlement offers the class real, immediate value rather than the uncertainty of continued litigation.

Who Pays, and How Much

Under the agreement, settling defendants Ken Moelis, Michael Spellacy, Emanuel Pearlman, David Fox and Eileen Murray will fund the $15 million settlement — either directly or through their insurers and indemnitors. The payment structure is split into an initial $1 million, with the remaining $14 million due once the court enters final judgment approving the deal.

Once taxes, administrative costs, attorney fees and other approved expenses are deducted, the remaining funds will be distributed to eligible class members under a plan still subject to court approval. Plaintiffs' counsel intends to seek fees and expenses of up to 20% of the settlement fund — as much as $3 million — along with service awards of up to $2,500 for each of the named plaintiffs.

Why Both Sides Chose to Settle

The plaintiffs cited the familiar calculus behind most settlements of this size: the uncertainty of continued litigation, the difficulty of proving liability and damages at trial, the strength of the defendants' available defenses, and the time and expense that a trial — and any subsequent appeals — would demand.

The defendants, for their part, continue to deny any wrongdoing, including the underlying allegations that the merger itself was unfair or that they breached any duty owed to Atlas Crest stockholders. Their stated rationale for settling centers on avoiding the burden and cost of further litigation rather than any admission of liability.

If the court approves the deal, the litigation will be dismissed with prejudice, releasing claims tied to the merger, its disclosures, and the alleged impairment of Atlas Crest stockholders' redemption rights.

What Happens Next

Representatives for the parties did not immediately respond to requests for comment Tuesday. But with a settlement structure already in place and both sides having weighed in on the record about why they're willing to close this chapter, the case now moves into its final phase: waiting for the Delaware court to decide whether $15 million, and nearly two years of litigation, is enough to put the matter to rest.