This is a securities class action lawsuit filed by Hagens Berman on behalf of its clients against ChargePoint Holdings, Inc. (NYSE: CHPT) and certain of its senior executives. The new complaint, which is based on Hagens Berman’s investigation, significantly extends the alleged fraudulent period pled in a prior class action against ChargePoint, contending that ChargePoint’s stock was artificially inflated by defendants’ alleged fraud from Dec. 7, 2021 through Nov. 16, 2023, inclusive (“Extended Class Period”).
The complaint alleges that Defendants misrepresented and concealed that (1) ChargePoint was experiencing higher component costs and supply overruns for first generation DC charging products, and (2) that, as a result, the Company was likely to incur impairment charges impacting profitability.
The truth began to emerge on Sep. 6, 2023, when ChargePoint reported its 2Q 2024 financial results, including a “$28.0 million, or 19 percentage point, inventory impairment charge.” The Company stated the “inventory impairment charge was taken to address legacy supply chain-related costs and supply overruns on a particular DC product.”
Then, on Nov. 16, 2023, ChargePoint announced preliminary Q3 2024 financial results, which would include an “additional non-cash inventory impairment charge” in the amount of $42 million “related to product transitions and to better align inventory with current demand.” As a result, the Company expected to report “GAAP gross margin of negative 23% to negative 21%.” The Company also reported revenue had fallen to “$108 million to $113 million, as compared to $150 to $165 million as previously expected.”
Moreover, ChargePoint announced the abrupt departures of its CEO (Pasquale Romano) and, at the request of its board, its CFO (Rex S. Jackson).
These disclosures caused the price of ChargePoint shares to decline sharply, injuring investors.
On January 29, 2024, seven separate motions were filed seeking appointment of lead plaintiff and approval of their selection of counsel, including two ChargePoint investors represented by Hagens Berman. The lead plaintiff motions were fully brief as of February 20, 2024, argued on March 14, 2024, and are now awaiting an order from the Court.
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