In a Landmark Decision, Mullen Defeats Defendants’ Motion to Dismiss in Its Entirety, Allowing the Federal Spoofing Lawsuit to Combat Artificially Deflated Stock Prices to Proceed
Mullen Automotive (NASDAQ: MULN) has secured a significant legal victory as a federal judge denied a motion to dismiss their lawsuit against IMC Financial Markets, Clear Street Markets , and UBS Securities. The lawsuit, filed in the Southern District of New York, alleges that between November 5, 2021, and November 15, 2023, the defendants engaged in stock manipulation through spoofing practices.
The lawsuit claims defendants used high-frequency algorithmic trading to artificially deflate MULN's share price through 'Baiting Orders' - placing sell orders to create false downward trends, followed by buying at artificially low prices. The Court found that Mullen adequately demonstrated how defendants' actions differed from typical market participants, noting their pattern of placing and canceling high volumes of orders within seconds or milliseconds.
The ruling, received on March 28, 2025, allows the case to proceed to full discovery, marking a victory for Mullen and other emerging companies affected by alleged stock manipulation.
Mullen Automotive (NASDAQ: MULN) ha ottenuto una significativa vittoria legale poiché un giudice federale ha respinto una mozione per archiviare la loro causa contro IMC Financial Markets, Clear Street Markets e UBS Securities. La causa, presentata nel Distretto Meridionale di New York, accusa i convenuti di manipolazione azionaria attraverso pratiche di spoofing tra il 5 novembre 2021 e il 15 novembre 2023.
La causa afferma che i convenuti hanno utilizzato trading algoritmico ad alta frequenza per abbattere artificialmente il prezzo delle azioni di MULN attraverso 'Ordini di Esca' - piazzando ordini di vendita per creare false tendenze al ribasso, seguiti da acquisti a prezzi artificialmente bassi. La Corte ha stabilito che Mullen ha dimostrato in modo adeguato come le azioni dei convenuti differissero da quelle dei partecipanti tipici del mercato, notando il loro schema di piazzare e annullare volumi elevati di ordini in pochi secondi o millisecondi.
La sentenza, ricevuta il 28 marzo 2025, consente al caso di procedere a una piena scoperta, segnando una vittoria per Mullen e altre aziende emergenti colpite dalla presunta manipolazione azionaria.
Mullen Automotive (NASDAQ: MULN) ha conseguido una importante victoria legal, ya que un juez federal rechazó una moción para desestimar su demanda contra IMC Financial Markets, Clear Street Markets y UBS Securities. La demanda, presentada en el Distrito Sur de Nueva York, alega que entre el 5 de noviembre de 2021 y el 15 de noviembre de 2023, los demandados participaron en manipulación de acciones a través de prácticas de spoofing.
La demanda afirma que los demandados utilizaron trading algorítmico de alta frecuencia para devaluar artificialmente el precio de las acciones de MULN mediante 'Órdenes de Cebo', colocando órdenes de venta para crear falsas tendencias a la baja, seguidas de compras a precios artificialmente bajos. La Corte encontró que Mullen demostró adecuadamente cómo las acciones de los demandados diferían de las de los participantes típicos del mercado, señalando su patrón de colocar y cancelar altos volúmenes de órdenes en segundos o milisegundos.
La decisión, recibida el 28 de marzo de 2025, permite que el caso avance hacia un descubrimiento completo, marcando una victoria para Mullen y otras empresas emergentes afectadas por la supuesta manipulación de acciones.
멀렌 오토모티브 (NASDAQ: MULN)는 연방 판사가 IMC 금융 시장, 클리어 스트리트 마켓 및 UBS 증권에 대한 소송을 기각하라는 요청을 거부하면서 중요한 법적 승리를 거두었습니다. 이 소송은 2021년 11월 5일부터 2023년 11월 15일 사이에 피고들이 스푸핑 관행을 통해 주식 조작에 관여했다고 주장합니다.
소송에 따르면 피고들은 '미끼 주문'을 통해 MULN의 주가를 인위적으로 하락시키기 위해 고주파 알고리즘 거래를 사용하여 판매 주문을 배치하여 잘못된 하락 추세를 만들고, 그 뒤에 인위적으로 낮은 가격으로 구매했습니다. 법원은 멀렌이 피고의 행동이 일반적인 시장 참여자와 어떻게 다른지를 적절히 입증했으며, 몇 초 또는 밀리초 이내에 높은 양의 주문을 배치하고 취소하는 패턴을 지적했습니다.
2025년 3월 28일에 받은 판결은 사건이 전체 발견 절차로 진행될 수 있도록 허용하며, 이는 멀렌과 주장된 주식 조작의 영향을 받은 다른 신생 기업들에게 승리를 의미합니다.
Mullen Automotive (NASDAQ: MULN) a remporté une victoire juridique significative, un juge fédéral ayant rejeté une motion visant à rejeter leur poursuite contre IMC Financial Markets, Clear Street Markets et UBS Securities. La poursuite, déposée dans le district sud de New York, allègue qu'entre le 5 novembre 2021 et le 15 novembre 2023, les défendeurs ont participé à une manipulation des actions par le biais de pratiques de spoofing.
La poursuite affirme que les défendeurs ont utilisé le trading algorithmique à haute fréquence pour faire baisser artificiellement le prix des actions de MULN par le biais d'« Ordres d'Appât » - plaçant des ordres de vente pour créer de fausses tendances à la baisse, suivis d'achats à des prix artificiellement bas. La Cour a constaté que Mullen avait suffisamment démontré comment les actions des défendeurs différaient de celles des participants typiques du marché, notant leur schéma de placement et d'annulation de volumes élevés d'ordres en quelques secondes ou millisecondes.
Le jugement, reçu le 28 mars 2025, permet au cas de passer à la découverte complète, marquant une victoire pour Mullen et d'autres entreprises émergentes touchées par la manipulation présumée des actions.
Mullen Automotive (NASDAQ: MULN) hat einen bedeutenden rechtlichen Sieg errungen, da ein Bundesrichter einen Antrag auf Abweisung ihrer Klage gegen IMC Financial Markets, Clear Street Markets und UBS Securities abgelehnt hat. Die Klage, die im Southern District of New York eingereicht wurde, behauptet, dass die Beklagten zwischen dem 5. November 2021 und dem 15. November 2023 in Aktienmanipulation durch Spoofing-Praktiken verwickelt waren.
Die Klage behauptet, dass die Beklagten algorithmischen Hochfrequenzhandel genutzt haben, um den Aktienkurs von MULN künstlich zu drücken, indem sie 'Lockangebote' platzierten - Verkaufsaufträge, um falsche Abwärtstrends zu erzeugen, gefolgt von Käufen zu künstlich niedrigen Preisen. Das Gericht stellte fest, dass Mullen angemessen nachgewiesen hat, wie sich die Handlungen der Beklagten von typischen Marktteilnehmern unterschieden, und wies auf ihr Muster hin, hohe Volumina von Aufträgen innerhalb von Sekunden oder Millisekunden zu platzieren und zu stornieren.
Das Urteil, das am 28. März 2025 erlassen wurde, ermöglicht es dem Fall, in die vollständige Entdeckung überzugehen, was einen Sieg für Mullen und andere aufstrebende Unternehmen markiert, die von angeblicher Aktienmanipulation betroffen sind.
- Federal court allows lawsuit against major financial institutions to proceed, potentially recovering damages from alleged stock manipulation
- Legal victory strengthens company's position against alleged market manipulation affecting share price
- Company's stock price potentially affected by alleged market manipulation during Nov 2021-Nov 2023 period
- Legal proceedings may require significant time and resources before potential resolution
Insights
This court ruling represents a significant legal victory for Mullen in its battle against alleged market manipulation. The federal judge's decision to deny the motion to dismiss by IMC Financial Markets, Clear Street Markets, and UBS Securities is particularly noteworthy as the complaint survived challenges on all contested issues.
The court specifically acknowledged Mullen's evidence showing defendants placed and canceled high volumes of sell orders within milliseconds thousands of times - a classic pattern of spoofing activity. The ruling validates that Mullen's claims were substantive enough to proceed to full discovery, which is a critical threshold in securities litigation where many similar cases fail.
Discovery will now give Mullen access to defendants' internal communications and trading data, potentially uncovering the full extent of alleged manipulation. If successful, this case could establish an important precedent for other small-cap companies targeted by similar trading practices.
The litigation addresses activities spanning two years (Nov 2021-Nov 2023) when Mullen's stock was allegedly artificially depressed. While this ruling doesn't guarantee ultimate victory, it significantly enhances Mullen's negotiating position and may eventually lead to financial remedies that could strengthen the company's balance sheet.
This legal development could have material financial implications for Mullen beyond just legal vindication. By successfully moving into the discovery phase, Mullen has cleared a significant hurdle that increases the probability of either a favorable settlement or court victory.
The lawsuit covers an extended period (Nov 2021-Nov 2023) when Mullen was likely raising capital. If the allegations are proven true, artificial stock price depression would have forced the company to issue more shares than necessary to raise equivalent funds, resulting in excessive dilution of existing shareholders.
From a balance sheet perspective, any potential monetary damages could provide Mullen with essential capital during its critical commercialization phase for electric vehicles. With a current market cap of just
What makes this particularly significant is that the defendants include major financial institutions with deep pockets. The court's acknowledgment that Mullen identified patterns distinguishing defendants from "typical market participants" strengthens the potential for meaningful financial recovery if Mullen prevails in the underlying case.
In a significant victory for Mullen and other emerging companies who have alleged losses due to stock manipulation, a federal judge denied IMC, Clear Street, and UBS’s motion to dismiss the lawsuit, finding Mullen’s claims were adequately pled. The litigation will now move forward into full discovery
In the Federal Court’s decision, received after the close of trading on March 28, 2025, Mullen won on all contested issues
BREA, Calif., March 31, 2025 (GLOBE NEWSWIRE) -- via IBN -- Mullen Automotive Inc. (NASDAQ: MULN) (“Mullen” or the “Company”), an electric vehicle (“EV”) manufacturer, successfully overcame a motion to dismiss brought by defendants IMC Financial Markets, Clear Street Markets LLC, UBS Securities, LLC and Does 1-10 (“Defendants”).
In the lawsuit, which is pending in the United States District Court for the Southern District of New York, Mullen alleges that between November 5, 2021 and November 15, 2023, Defendants used high-frequency algorithmic trading to manipulate and spoof Mullen shares in violation of Section 10(b), Rule 10b-5(a) and (c), and Section 9(a) of the Securities Exchange Act of 1934, and New York common law fraud.
FINRA has characterized spoofing as an insidious form of market manipulation that undermines the transparency and integrity of the markets by distorting the true nature of supply and demand. Spoofing involves the submission and cancellation of non-bona fide buy and sell orders that have no legitimate economic purpose and are not intended to be executed. With “Baiting Orders,” for example, Defendants allegedly placed sell orders meant to create a false signal that Mullen’s share price was trending downward, tricking other market participants into entering their own orders to sell. The spoofers then executed buy orders—now at artificially low prices—and promptly canceled their Baiting Orders.
In rejecting Defendants’ motion to dismiss, the Court held, among other things, that Mullen had “identif[ied] a number of actions that differentiate the Defendants from typical market participants. Defendants placed far more orders for sell-side shares that were subsequently canceled and then purchased far more shares at depressed prices following spoofing episodes[.]” In particular, “Defendants placed and then cancelled a high volume of Baiting Orders within seconds and even milliseconds, repeating this pattern thousands of times, often with multiple episodes per trading day.” In turn, the Court determined that Mullen’s complaint “outlines Defendants’ efforts to artificially depress the price of Mullen securities and the subsequent effects on the market.”
“We are pleased with the Court’s decision and look forward to continuing our fight to protect our company and our shareholders,” said David Michery, CEO and chairman of Mullen Automotive.
Stephen W. Tountas, the lead lawyer for plaintiffs, added that “we look forward to commencing discovery to expose Defendants’ pervasive and manipulative trading practices, which have significantly harmed both Mullen and its shareholders.”
The case is captioned, Mullen Automotive, Inc. et al v. Clear Street Markets LLC et al, No. 1:23-cv-10637 (S.D.N.Y.).
About Kasowitz Benson Torres LLP
Kasowitz is a leading national litigation law firm. The firm focuses on complex commercial, corporate and securities litigation, and represents clients on a wide range of matters, from class action litigations to privately negotiated resolutions of complicated disputes.
This Mullen team is being led by Kasowitz partners Stephen W. Tountas and Andrew L. Schwartz.
About Mullen
Mullen Automotive (NASDAQ: MULN) is a Southern California-based automotive company building the next generation of commercial electric vehicles (“EVs”) with two United States-based vehicle plants located in Tunica, Mississippi, (120,000 square feet) and Mishawaka, Indiana (650,000 square feet). In August 2023, Mullen began commercial vehicle production in Tunica. As of January 2024, both the Mullen ONE, a Class 1 EV cargo van, and Mullen THREE, a Class 3 EV cab chassis truck, are California Air Resource Board (“CARB”) and EPA certified and available for sale in the U.S. The Company’s commercial dealer network consists of seven dealers, which includes Papé Kenworth, Pritchard EV, National Auto Fleet Group, Ziegler Truck Group, Range Truck Group, Eco Auto, and Randy Marion Auto Group, providing sales and service coverage in key West Coast, Midwest, Pacific Northwest, New England, and Mid-Atlantic markets.
In September 2022, Bollinger Motors, of Oak Park, Michigan, became a majority-owned EV truck company of Mullen Automotive. Bollinger Motors has passed numerous milestones including its B4, Class 4 electric truck production launch on Sept. 16, 2024, and the development of a world-class dealer and service network with over 50 locations across the United States.
To learn more about the Company, visit www.MullenUSA.com.
Forward-Looking Statements
Certain statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1934, as amended. Any statements contained in this press release that are not statements of historical fact may be deemed forward-looking statements. Words such as “continue,” “will,” “may,” “could,” “should,” “expect,” “expected,” “plans,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential” and similar expressions are intended to identify such forward-looking statements. All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, many of which are generally outside the control of Mullen and are difficult to predict. Examples of such risks and uncertainties include, but are not limited to the eventual outcome of the referenced lawsuit. Additional examples of such risks and uncertainties include but are not limited to: (i) Mullen’s ability (or inability) to obtain additional financing in sufficient amounts or on acceptable terms when needed; (ii) Mullen's ability to maintain existing, and secure additional, contracts with manufacturers, parts and other service providers relating to its business; (iii) Mullen’s ability to successfully expand in existing markets and enter new markets; (iv) Mullen’s ability to successfully manage and integrate any acquisitions of businesses, solutions or technologies; (v) unanticipated operating costs, transaction costs and actual or contingent liabilities; (vi) the ability to attract and retain qualified employees and key personnel; (vii) adverse effects of increased competition on Mullen’s business; (viii) changes in government licensing and regulation that may adversely affect Mullen’s business; (ix) the risk that changes in consumer behavior could adversely affect Mullen’s business; (x) Mullen’s ability to protect its intellectual property; and (xi) local, industry and general business and economic conditions. Additional factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements can be found in the most recent annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K filed by Mullen with the Securities and Exchange Commission. Mullen anticipates that subsequent events and developments may cause its plans, intentions and expectations to change. Mullen assumes no obligation, and it specifically disclaims any intention or obligation, to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by law. Forward-looking statements speak only as of the date they are made and should not be relied upon as representing Mullen’s plans and expectations as of any subsequent date.
Contact:
Mullen Automotive, Inc.
+1 (714) 613-1900
www.MullenUSA.com
Corporate Communications:
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Austin, TX
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512.354.7000 Office
Editor@InvestorBrandNetwork.com
FAQ
What are the specific allegations in Mullen's federal spoofing lawsuit against IMC, Clear Street, and UBS?
How did the defendants allegedly manipulate MULN stock through spoofing?
What evidence did the Court cite in allowing MULN's spoofing lawsuit to proceed?
When did the Court rule on MULN's federal spoofing lawsuit?
