The Class Action Securities Lawsuit
On April 6, 2023, Plaintiff, Elizabeth Coffey, filed a lawsuit in the United States District Court for the Northern District of Illinois, Eastern Division, Case No. 1:23-cv-02175, pending before the Honorable Judge John F. Kness, alleging that Defendants, Kerrisdale Capital Management, LLC and Sahm Adrangi, committed securities fraud in manipulating the market for the common stock of C3.ai, Inc., trading on the New York Stock Exchange under the ticker “AI.” The complaint has been amended twice, once to add Daniel Koycyk as a plaintiff, and second time on June 15, 2023, to add additional details, define the “Class Period” and add recent events regarding C3.ai, Inc. (the “Class Action Securities Lawsuit”).
This Notice is made pursuant to the mandatory requirements of the Private Securities Litigation Reform Act, (PSLRA), 15 U.S.C. §§ 77z-1(a)(3)(A), 78u-4(a)(3)(A). Any purported class member may move the Court in the Class Action Securities Lawsuit to serve as lead plaintiff of the plaintiff Class within sixty (60) days of the publication of this Notice.
The Class Period
The Class Action Securities Lawsuit seeks to compensate those investors who, during the Class Period, sold their shares of C3.ai, Inc. during the period April 4, 2023, through April 6, 2023, inclusive, and sustained a loss as a result of the difference between the price of the stock at the close of the markets on April 3, 2023, and the sale price of the stock at the time of the sale of their shares in C3.ai, Inc. on or before the close of the markets on April 6, 2023.
The Class is composed only of individuals and entities who owned shares of C3.ai, Inc. at the close of the markets on April 3, 2023. Pursuant to Federal Rule of Civil Procedure (“FRCP”) 23(a), (b)(2), and (b)(3), Plaintiffs bring this action on behalf of themselves and the following Multi-State Class: Any person who has sold a share or shares of the common stock of C3.ai, Inc. residing in the fifty (50) states, and the District of Columbia, on or after April 4, 2023, and on or before the close of the markets on April 6, 2023; buyers of call options on C3.ai, Inc. who were long the call option as of April 4, 2023, and who sustained losses during that three (3) day period through April 6, 2023, and sold their positions on or before the close of the markets on April 6, 2023; and sellers of put options on C3.ai, Inc. who were short the put position as of April 4, 2023, and who sustained losses during that three (3) day period through April 6, 2023, and sold their positions on or before the close of the markets on April 6, 2023.
The Claims Asserted in the Class Action Securities Lawsuit
The Class Action Securities Lawsuit alleges violations of the Exchange Act, Rule 10b-5(a) & (c) and Sections 9(b) (2) & (4), as amended, by Defendants, Kerrisdale Capital Management, LLC and Sahm Adrangi, “activist” short-sellers of common stock in the publicly-listed and traded C3.ai, Inc., a technology company, when they issued a written letter dated April 4, 2023, prior to the opening of the stock markets, beginning on or about 8:05 a.m. ET April 4, 2023, which was widely disseminated to the public via Kerrisdale Capital Management, LLC and Sahm Adrangi by Twitter, with a link to the April 4, 2023 Letter, and available to the public on Kerrisdale Capital Management, LLC’s website and referenced and discussed later that day on Sahm Adrangi’s public appearance on CNBC’s television show known as the “Closing Bell.”
The Class Action Securities Lawsuit alleges that the April 4, 2023 Letter contained knowingly false and deceptive derogatory statements made by Defendants about, inter alia, the accounting practices of C3.ai, Inc. for the purpose of manipulating and artificially driving down the price of the common stock in C3.ai, Inc. temporarily, in order for Kerrisdale Capital Management, LLC and Sahm Adrangi to “cover the short” and generate substantial profits for themselves, their investors and affiliates.
The April 4, 2023 Letter authored by Kerrisdale Capital Management, LLC and Sahm Adrangi, accused C3.ai, Inc. of, inter alia, knowingly creating financial statements that contain “deceitful accounting,” “[using] fraudulent accounting conventions,” “to fool market participants by painting a false portrait of the company’s profit and loss,” “trying to cover up a failing business,” “investors are being conned,” “hiding costs,” “booking fictional revenue,” and making “a mockery of …the SEC’s reporting requirements.”
The April 4, 2023 Letter also accused Deloitte & Touche LLP, one of the nation’s leading auditing, accounting and consulting firms, and C3.ai, Inc.’s auditor, of, inter alia, “rubber stamping fraudulent accounting,” and directed Deloitte & Touche LLP “to come clean in its upcoming audit or resign” and essentially accused Deloitte & Touche LLP of colluding with C3.ai., Inc., to deceive the investing public.
The Class Action Securities Lawsuit alleges that the April 4, 2023 Letter had the effect specifically intended by Kerrisdale Capital Management, LLC and Sahm Adrangi on the day of its release to the public as well as the following days (April 5 & 6, 2023), of driving down the price of the common shares of stock in C3.ai, Inc. by over one-quarter (1/4) of their value, resulting in a loss to its market capitalization of C3.ai, Inc. in an amount in excess of one-billion dollars ($1,000,000,000), and, at the same time, causing Kerrisdale Capital Management, LLC to reap substantial profits from Kerrisdale’s short positions on their C3ai, Inc. common stock.
Ability To Serve As Lead Plaintiff Of Purported Plaintiff Class
Any purported class member may move the Court in the Class Action Securities Lawsuit to serve as lead plaintiff of the purported plaintiff class within sixty (60) days of the publication of this Notice.
Plaintiffs are currently represented by Daniel J. Voelker, Esq. of Voelker Litigation Group, 33 N. Dearborn Street, Suite 1000, Chicago, Illinois 60602, 312.870.5430, 312.505.4841 and [email protected].
Prepared by:
Daniel J. Voelker, Esq.
Voelker Litigation Group
33 N. Dearborn Street
Suite 1000
Chicago, Illinois 60602
312.870.5430
312.505.4841
[email protected]
www.voelkerlitigationgroup.com