Max Royal LLC v. Atieva, Inc.

I. BACKGROUND

A. Facts Before February 2021, Lucid was a private company in the business of manufacturing electric cars. On February 22, 2021, Lucid was acquired by a nonparty company, Churchill Capital Corporation IV (“CCIV”), and then these two companies merged into one. CCIV was a “special purpose acquisition company” (“SPAC”). SPACs are publicly

MAX ROYAL LLC V. ATIEVA, INC.

traded companies created for the sole purpose of acquiring another company within a limited window of time. 1 Merger negotiations between Lucid and CCIV occurred between January 11 and February 22, 2021. During that time, it was widely speculated that CCIV would acquire Lucid, based on extensive reporting in the financial press. However, neither CCIV nor Lucid spoke publicly about the merger negotiations during this time. On February 5 and 12, 2021, Lucid CEO Rawlinson made misrepresentations about Lucid’s ability to meet certain production targets. In an interview on CNBC, Rawlinson confirmed the interviewer’s understanding that “[Lucid] expect[ed] to produce 6,000 to 7,000 units [in 2021]” and represented that “we’ve already built our first phase of our factory in Arizona, which is…