Will Mullen’s (NASDAQ:MULN) new manipulation lawsuit save the company from piling short sellers?
The company’s short interest has spiked to 23.69%, indicating an increase in shorting activity in the EV company.
On Tuesday Mullen Automotive announced that it has filed a lawsuit in the United States District Court, in the Southern District of New York, against TD Ameritrade, Charles Schwab, National Finance Services and others alleging that these broker-dealers engaged in a scheme to manipulate the share price of the Company’s securities.
The lawsuit seeks compensatory damages and injunctive relief from Defendants arising from their unlawful conduct in violation of Section 10b and Rule 10b-5 promulgated thereunder of the Securities Exchange Act of 1934.
“MULN is one of the largest traded stocks on the NASDAQ, and it has seen a precipitous decline in value despite announcements highlighting many Company successes.
I have been extremely frustrated by the performance of our stock and long-suspected illegal short-selling activities.
That is why we engaged Share Intel and the law firms of Christian Attar and Warshaw Burstein to investigate this matter further to protect the Company and its loyal shareholder base.
I am hopeful that this lawsuit sends a clear and unequivocal message to anyone considering any form of illegal trading of Mullen stock.
Our company has a zero-tolerance approach when it comes to manipulative trading practices.
We believe the Company and its shareholders have been significantly harmed by certain traders and their brokers and market makers, such as the named Defendants in the lawsuit, that have facilitated this unlawful conduct.
Rest assured, we will use all legal measures at our disposal to stop illegal trading activities and to protect the Company and its shareholders,” said Mullen CEO David Michery.
“Like you, we saw the press release this morning but have not yet reviewed the filing,” a spokesperson from Charles Schwab told FrankNez Tuesday morning.
Mullen Automotive Falls -99% This Year-to-Date
Shares of the EV company have now fallen more than -99% this year-to-date and continue to hit new all-time lows.
“My law firm and my co-counsel, Alan Pollack, from Warshaw Burstein, together with our team of experts and analysts, are committed to representing companies like Mullen who are targets of dishonest broker-dealers who employ schemes and devices to manipulate the share price of their companies securities.
The Mullen lawsuit involves concerted efforts by the Defendants to destroy Mullen’s share price by engaging in an abusive short-selling scheme.
This scheme was intended to inject false and misleading information about Mullen into the market, which has caused many shareholders to sell their investments in Mullen.
Like our client, we are committed to protecting the rights and interests of their shareholders who we believe have been victimized by unscrupulous broker-dealers who have perpetrated fraud on the marketplace,” said Wes Christian in a statement.
In February, I published a report highlighting 3 signs pointing towards naked short selling in Mullen Automotive, but is it too late?
Shareholder value has been decimated by several reverse stock split, and it looks like Mullen might be headed that way again, that is unless massive buy volume is able to raise the stock’s price over Nasdaq’s $1 bid level.
Filings show that these brokers have officially been summoned by the court, now its just a waiting game to see what comes from it.
Will Mullen’s new manipulation lawsuit save the company? What do you think? Leave your thoughts in the comment section down below.
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