Rivian Automotive, Inc. (NASDAQ:RIVN) announced on Thursday that it has agreed to pay $250 million to resolve a 2022 securities class action lawsuit filed by investors.
- RIVN stock is staying put for now. See the trading setup here
What Is The Lawsuit?
The lawsuit alleges violations of the federal securities laws, specifically the Securities Act of 1933 and the Securities Exchange Act of 1934. The plaintiffs seek damages for financial losses suffered.
The core allegation of the lawsuit claims that Rivian’s IPO offering documents and certain post-IPO statements contained materially false and misleading information.
Also Read: Rivian Narrows 2025 Delivery Targets As Market Pressures Mount
The central allegation is the failure to disclose that the bill of materials cost for Rivian’s R1S and R1T electric vehicles “far exceeded the sales price,” which then required the company to increase retail prices.
Rivian stated that the settlement is not an admission of wrongdoing.
Still, it will allow the company to focus its resources on launching its upcoming mass-market R2 vehicle, which is slated for the first half of 2026.
Financial Payment
The agreement, which requires court approval, will resolve claims from investors who purchased Rivian stock between November 10, 2021, and March 10, 2022.
To fund the payment, Rivian will use $67 million from its insurance coverage and $183 million from its cash reserves.
Rivian R2
Recently, Rivian CEO RJ Scaringe provided several key updates on the company’s strategy, competitive challenges and more.
Scaringe confirmed that Rivian is on track to begin deliveries of its highly anticipated R2 midsize SUV in the first half of 2026, with the company currently in the building and testing phase.
He noted that the new $5 billion Georgia plant will support future production starting in 2028.
Scaringe acknowledged that Chinese EV makers like BYD Co Ltd (OTC:BYDDY) possess a significant cost advantage due to lower capital and labor expenses.
He also commented on the volatile tariff environment, stating Rivian is mitigating this risk with a U.S.-centric supply chain for the R2.
Rivian stock is down nearly 2% year-to-date, coinciding with its narrowed delivery forecast for 2025, a recall of vehicles due to a software issue, and ongoing financial and market pressures amid the end of the federal EV tax credit.
RIVN Price Action: Rivian Automotive shares were up 0.92% at $13.21 during premarket trading on Friday, according to Benzinga Pro data.
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