Self-driving trucking company TuSimple Holdings Inc. has agreed to pay $189 million to settle a class action lawsuit accusing it of misleading investors about its safety record and its relationship with a Chinese rival, which triggered U.S. government investigations. The settlement was disclosed in a filing Monday in a California federal court.
TuSimple Settles Fraud Lawsuit for $189M : Significant Recovery for Investors
The lawsuit, led by the Indiana Public Retirement System, was filed in August 2022 and claims that TuSimple’s stock value plunged by 98% following its $1.4 billion IPO in April 2021. The stock nosedive came after negative media reports surfaced about federal probes into the company’s business practices and a crash involving a TuSimple semi-truck. The settlement, pending court approval, would distribute the $189 million to investors who held shares between the IPO and December 2022.
Investor firms Robbins Geller Rudman & Dowd LLP and Kahn Swick & Foti LLC intend to seek attorney fees totaling no more than 25% of the settlement. The lawsuit’s lead plaintiff described the settlement as “one of the most significant securities class action recoveries ever obtained” in the Southern District of California.
TuSimple Settles Fraud Lawsuit for $189M : Safety Concerns and Alleged Fraud
The lawsuit primarily revolved around the Arizona crash of a TuSimple self-driving truck, which was allegedly captured by a whistleblower and posted online in July 2022. The crash was used to support claims that TuSimple had exaggerated the safety of its autonomous vehicles, undermining investor confidence.
