In a dramatic resolution to a heated legal battle, QuantumScape Corp., its top executives, and the special-purpose acquisition company (SPAC) that took the lithium-metal battery innovator public have agreed to an $8.75 million settlement to close a shareholder derivative lawsuit. The case, which alleged breaches of fiduciary duty surrounding the QuantumScape-Kensington Capital Acquisition Corp. merger, reached a resolution in Delaware’s Chancery Court on Wednesday.
Settlement Without Admission of Guilt
According to the settlement filing, the agreement was reached to eliminate further litigation risks and costs, while firmly denying any wrongdoing. Kensington and QuantumScape leaders maintained they did nothing improper but opted for settlement to put the matter to rest once and for all.
The lawsuit was originally brought by QuantumScape shareholder Sheadrick Richards, who claimed that Kensington’s leadership put their financial interests ahead of stockholders by rushing the merger through without due diligence.
A Merger Under Fire
Kensington Capital, a SPAC, went public in June 2020, and just a few months later, in September 2020, it announced plans to acquire QuantumScape. By November 25, 2020, the deal had closed, and Kensington had rebranded as QuantumScape.
