The Law Offices of Frank R. Cruz Announces the Filing of a Securities Class Action on Behalf of PureCycle Technologies, Inc. (PCT) Investors
Jun 24, 2021 2:49 PM ET
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The Law Offices of Frank R. Cruz announces that a class action lawsuit has been filed on behalf of persons and entities that purchased or otherwise acquired PureCycle Technologies, Inc. securities between November 16, 2020 and May 5, 2021, inclusive (the "Class Period"). PureCycle investors have until July 12, 2021 to file a lead plaintiff motion.
If you are a shareholder who suffered a loss, click here to participate.
On May 6, 2021, before the market opened, Hindenburg Research issued a report alleging that PureCycle is "another quintessential example of how executives and SPAC sponsors enrich themselves while hoisting unproven technology and ridiculous financial projections onto the public markets, leaving retail investors to face the ultimate consequences." Hindenburg explained that it spoke with "multiple former employees" of earlier companies that PureCycle's CEO and other associated executives took public before PureCycle, "who said that PureCycle's executives based their financial projections on 'wild… guessing,' brought companies public far too early, and had deceived investors." The report also noted Hindenburg was "unable to find a single peer reviewed study in any scholarly journal citing or reviewing PureCycle's licensed process," and that Hindenburg spoke to a "30-year expert on polymers" who "referred to the company's flammable pressurized process as a 'bomb' and warned about the company forging ahead to commercial scale despite having issues at a lab scale."
On this news, PureCycle's stock price fell $9.76, or 40%, to close at $14.83, on May 6, 2021, thereby injuring investors.
The complaint filed alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company's business, operations, and prospects. Specifically, Defendants failed to disclose to investors that: (1) the management team bringing PureCycle public had previously brought six other failed business public only to have each implode thereafter; (2) the management team bringing PureCycle public had characterized rank speculation as financial projections to investors in the past; (3) the primary motivation of the management team bringing PureCycle public was to complete any transaction, good or bad, to obtain tens of millions of dollars in cash and tradable shares; (4) PureCycle faces higher competition for high quality feedstock than it has led investors to believe, materially undermining the management team's financial projections; (5) PureCycle's patent is nowhere as cogent or valuable as it has led investors to believe, and the technology underlying its business operations is unproven and presents serious issues even at lab scale; (6) in reality, PureCycle's flammable pressurized process is not yet functional, especially at scale, and is dangerous; (7) PureCycle purports to be advancing to commercial production scale despite still having operational issues at a lab scale; and (8) as a result, Defendants' statements about its business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.
If you purchased PureCycle securities during the Class Period, you may move the Court no later than July 12, 2021 to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you purchased PureCycle securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Frank R. Cruz, of The Law Offices of Frank R. Cruz, 1999 Avenue of the Stars, Suite 1100, Los Angeles, California 90067 at 310-914-5007, by email to [email protected], or visit our website at www.frankcruzlaw.com.
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