News & Media
Entwistle & Cappucci LLP Investigative Alert: Nikola Corporation (NKLA)
September 16, 2020
NEW YORK–(BUSINESS WIRE)–Entwistle & Cappucci LLP (“Entwistle & Cappucci”) has been asked to investigate potential federal securities law violations on behalf of investors in Nikola Corporation (“Nikola” or the “Company”) (NASDAQ: NKLA) and VectoIQ Acquisition Corp. (“Vecto”) (NASDAQ: VTIQ) in connection with: (i) the 2018 formation of Vecto; (ii) Vecto shareholders’ 2020 approval of its business combination with Nikola; and (iii) public statements issued by Nikola to the present.
Vecto, a Special Purpose Acquisition Company or “blank check company,” was formed for the purpose of effecting a merger or business combination with one or more companies in the transportation or smart mobility industries. On March 3, 2020, Vecto announced its plan to merge with Nikola in a transaction valued at approximately $3.3 billion. The transaction purported to allow Nikola to accelerate production of its electric vehicles, break ground on its manufacturing facility and begin its hydrogen station infrastructure rollout. Upon completion of the business combination on June 3, 2020, Vecto changed its name to Nikola and its shares began trading under the ticker symbol “NKLA.”
Entwistle & Cappucci’s investigation includes the matters raised in the recent short seller report issued by Hindenburg Research (“Hindenburg”) and issues uncovered from other sources. While our investigation is ongoing, at the very least, it appears that Vecto and Nikola issued false and misleading statements in violation of the federal securities laws concerning Nikola’s: (i) development of fuel cell and car battery technology; (ii) ability to produce low-cost hydrogen; (iii) ownership of certain solar and gas assets; and (iv) order book and deposits for its Badger pick-up. Among other things, Entwistle & Cappucci is investigating whether:
- Vecto made misleading statements and omissions of material facts in the proxy for the business combination;
- Nikola entered into partnerships with some of the world’s top auto companies, including General Motors Company, based upon false information, in order to catch up with Tesla and take advantage of the electric vehicle revolution;
- Nikola’s claims that it had cut the cost of hydrogen production by approximately eighty (80) percent compared to its peers, and that it was already producing hydrogen on that basis were false and misleading;
- The Company’s advertisements concerning its vehicles’ purported ability to function on their own power and make use of the Company’s proprietary technology were materially misleading;
- Nikola’s promotional video, entitled “Nikola One in Motion,” falsely portrayed its semi-truck cruising on a road at a high rate of speed, when in fact the truck was being towed to the top of a hill on a remote stretch of highway and was simply filmed rolling down the hill;The Company’s contentions regarding outstanding orders for its vehicles were materially overstated;
- Nikola’s assertion that it designs all key components in-house, rather than buying or licensing them from third parties, was false and misleading;
- Nikola’s statements about the purported battery technology it planned to acquire from ZapGo Ltd. (“ZapGo”) were knowingly misleading, and failed to disclose ZapGo’s President had recently been indicted for tax fraud; and
- Nikola’s senior executives and key partners engaged in illicit insider selling of the Company’s common shares based upon material nonpublic information.
If you invested in Vecto (NASDAQ: VTIQ) or Nikola (NASDAQ: NKLA), or you have other information about these issues, please contact attorneys Robert N. Cappucci or Joshua K. Porter at 212-894-7200, or via email at [email protected], or [email protected].