The Core Scientific class action lawsuit charges Core Scientific and certain of its top executives with violations of the Securities Exchange Act of 1934. The Core Scientific class action lawsuit seeks appointment as lead plaintiff in the case of purchasers or acquirers of Core Scientific Inc. (NASDAQ: CORZ; CORZW) securities from January 3, 2022 to October 26, 2022, inclusive (the “Class Period”). Captioned Pang v. Core Scientific Inc., No. 22-cv-01191 (W.D. Tex.)
If you suffered substantial losses and wish to serve as the lead plaintiff of the Core Scientific class action lawsuit, please provide your information at: https://www.rgrdlaw.com/cases-core-scientific-inc-class-action-lawsuit-corz.html
You can also contact attorney J.C. Sanchez of Robbins Geller by calling 800/449-4900 or via e-mail at [email protected]. Lead plaintiff motions for the Core Scientific class action lawsuit must be filed with the court no later than January 13, 2023.
CASE ALLEGATIONS
Core Scientific mines digital assets for its own account and provides hosting services for other large-scale miners. Core Scientific became a public company via a January 19, 2022 business combination with Power & Digital Infrastructure Acquisition Corp., a special purpose acquisition company (“SPAC”), also called a blank-check company
The Core Scientific class action lawsuit alleges that the defendants made false and/or misleading statements and/or failed to disclose that:
- (i) Due in part to the expiration of a favorable pricing agreement, Core Scientific was experiencing increasing power costs;
- (ii) Core Scientific’s largest customer, Gryphon Digital Mining, lacked the financial resources to purchase the necessary miner rigs for Core Scientific to host;
- (iii) Core Scientific was not providing hosting services to Celsius Network LLC (“Celsius”) as required by their contract;
- (iv) Core Scientific had implemented an improper surcharge to pass through power costs to Celsius;
- (v) As a result of the foregoing alleged breaches of contract, Core Scientific was reasonably likely to incur liability to defend itself against Celsius;
- (vi) As such, Core Scientific’s profitability would be adversely impacted;
- (vii) Consequently, there was likely substantial doubt as to Core Scientific’s ability to continue as a going concern.
The stock price fell by more than 9%
On March 3, 2022, Culper Research published a report about Core Scientific alleging, among other things, that Core Scientific had overstated its profitability and that Core Scientific’s largest customer lacked the financial resources to deliver the rigs pursuant to its contract
The stock price fell by more than 10%
On September 28, 2022, Celsius and related entities filed a motion to enforce the automatic stay and for civil contempt in bankruptcy proceedings alleging that Core Scientific “has knowingly and repeatedly violated the automatic stay provisions” by refusing to perform its contractual obligations, threatening to terminate the companies’ agreement, and adding improper surcharges
The Stock price fell an additional 78.1%, further damaging investors
On October 27, 2022, Core Scientific disclosed that “[g]iven the uncertainty regarding [Core Scientific]’s financial condition, substantial doubt exists about [Core Scientific]’s ability to continue as a going concern,” and that it is exploring alternatives to its capital structure. Moreover, Core Scientific held 24 bitcoin, compared to 1,051 bitcoin as of September 30, 2022
Robbins Geller has launched a dedicated SPAC Task Force to protect investors in blank check companies and seek redress for corporate malfeasance. Comprised of experienced litigators, investigators, and forensic accountants, the SPAC Task Force is dedicated to rooting out and prosecuting fraud on behalf of injured SPAC investors. The rise in blank check financing poses unique risks to investors. Robbins Geller’s SPAC Task Force represents the vanguard of ensuring integrity, honesty, and justice in this rapidly developing investment arena.
THE LEAD PLAINTIFF PROCESS
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased or acquired Core Scientific securities during the Class Period to seek appointment as lead plaintiff in the Core Scientific class action lawsuit. A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class.
A lead plaintiff acts on behalf of all other class members in directing the Core Scientific class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Core Scientific class action lawsuit. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff of the Core Scientific class action lawsuit.
ABOUT ROBBINS GELLER RUDMAN & DOWD LLP
Robbins Geller Rudman & Dowd LLP is one of the world’s leading complex class action firms representing plaintiffs in securities fraud cases. The Firm is ranked #1 on the 2021 ISS Securities Class Action Services Top 50 Report for recovering nearly $2 billion for investors last year alone – more than triple the amount recovered by any other plaintiffs’ firm.
With 200 lawyers in 9 offices, Robbins Geller is one of the largest plaintiffs’ firms in the world and the Firm’s attorneys have obtained many of the largest securities class action recoveries in history, including the largest securities class action recovery ever – $7.2 billion – in In re Enron Corp. Sec. Litig.
Source: https://www.rgrdlaw.com/cases-core-scientific-inc-class-action-lawsuit-corz.html
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