TSP.US
id: 131
TuSimple (TSP) $189M Investor Settlement
S.D. California
Court3:22-cv-01300
Case number15 Apr 2021
Class period Start31 Oct 2022
Class period End31 Jan 2025
Claim deadlineTuSimple (TSP) has agreed to settle $189M with investors to resolve claims that it overstated safety and rushed testing, increasing accident risk.
Outline
In October 2022, WSJ reported TuSimple was under FBI, SEC, and CFIUS probes for issues with Chinese startup Hydron. Things escalated with potential espionage charges, CEO Hou’s resignation, and a whistleblower’s video exposing safety problems from a truck crash. Following this news, $TSP significantly fell, and TuSimple faced a lawsuit from investors.
Timeline
- On August 1, 2022: WSJ published a report on TuSimple titled "Self-Driving Truck Accident Draws Attention to Safety at TuSimple.”
- Following this news, $TSP fell by 9% on the same day.
- On October 30, 2022: WSJ reported that TuSimple is under FBI, SEC, and CFIUS investigations.
- After that, $TSP fell by over 45%.
- On February 10, 2023: $TSP stockholder filed a claim against TuSimple based on all these undisclosed issues.
Background
In May 2020, NASDAQ tightened IPO rules to limit Chinese companies, citing concerns over transparency and ties to Chinese officials.
Meanwhile, CFIUS investigated TuSimple’s links to Sun Dream and Sina Corporation, which has ties to the Chinese Communist Party.
Then, on April 6, 2022, a TuSimple autonomous truck crashed into a divider in Tucson, nearly hitting another vehicle. Despite CEO Hou's claims of no tech issues, a whistleblower’s video revealed the crash and showed it was due to system flaws, not human error.
After that, the Wall Street Journal’s article also highlighted serious safety concerns with TuSimple’s self-driving trucks, revealing the April crash and criticizing the company’s rushed and unsafe testing on public roads.
On this news, $TSP fell by 9.7% on August 1, 2022.
Moreover, on October 30, 2022, the Wall Street Journal reported that TuSimple was under FBI, SEC, and CFIUS investigation for potentially mishandling tech and finances with the Chinese startup Hydron. The next day, TuSimple admitted to sharing confidential information with Hydron and fired CEO Hou, citing improper disclosures.
As a result of all these revelations, $TSP stock dropped by over 98% from its IPO price.
What Can Investors Expect Now?
TuSimple recently decided to resolve the suit and settle $189M with investors to end claims related to overstating safety and rushing testing.
If you were damaged due to this situation, you can file for a payout and get your share of the settlement. You can check if you are eligible and other details in the FAQ section below.
Case Status
Preliminary Approved Settlement
Alleged Offence
Misleading Statements,
Failure to Disclose,
Negligence,
Omissions
Suspected Party
Directors,
Management
Security Type
Stocks
Trade Direction
Long
Payout per Share
0.62
Filing date
31 August 2022
Plaintiffs
Austin Dicker
Attorneys
Kahn Swick & Foti, LLC (San Francisco, CA), Robbins Geller Rudman & Dowd LLP (San Diego, CA)
Defendants
Cheng Lu, Patrick Dillon, Xiaodi Hou, Mo Chen, James Mullen
Judge
Hon. Roger T. Benitez
Administrator
Verita Global
Settlement agreement date
2024-08-22
Court hearing date
02 December 2024
Exclusion deadline
12 November 2024
Objection deadline
12 November 2024
Hearing deadline
02 December 2024
Attorney fee
$47,550,000
Class wide damages
$1,108,978,000
Trades matching type
FIFO
+$189,000,000
Cash Settlement Amount