Investors with Substantial Losses Have Opportunity to Lead the CarLotz, Inc. Class Action Lawsuit

San Diego, Calif .– (Newsfile Corp. – July 31, 2021) – The CarLotz class action lawsuit charges CarLotz, Inc. (NASDAQ: LOTZ) (NASDAQ: LOTZW) and some of its top executives for violating the Securities Exchange Act of 1934 and attempts to represent buyers of CarLotz securities between December 30, 2020 and May 25, 2021, inclusive (the “Class Period”). The CarLotz class action lawsuit (Erdman v. CarLotz, Inc., No. 21-cv-05906) was initiated in the Southern District of New York on July 8, 2021 and is assigned to Judge Ronnie Abrams. A similar lawsuit, Widuck v. CarLotz, Inc., No. 21-cv-06191, is also pending in the South District of New York.

If you would like to act as the lead plaintiff in the CarLotz class action, please provide your information by clicking here. You can also contact Attorney JC Sanchez of Robbins Geller by phone at 800 / 449-4900 or by email at [email protected]. Motions by the lead plaintiffs for the CarLotz class action must be filed with the court by September 7, 2021 at the latest.

CASE ALLEGES: On or about January 21, 2021, CarLotz became a public entity, capital stock exchange, public entity, capital stock exchange, by merging with Acamar Partners Acquisition Corp. Acquisition of assets, share purchase, restructuring or similar business combination with one or more companies.

The CarLotz class action alleges that during the class action period, defendants made false and misleading information and failed to disclose: (i) Due to an increase in inventory in the second half of FY 2020, CarLotz experienced a “congestion” with slower processing and higher sales days; (ii) doing so would adversely affect CarLotz’s Gross Profit Per Unit (“GPU”); (iii) in order to minimize returns to the company’s vehicle sourcing partner, who is responsible for more than 60% of CarLotz’s inventory, CarLotz offered aggressive pricing; (iv) consequently, CarLotz’s GPU forecast was likely inflated; (v) that the CarLotz Company Vehicle Sourcing Partner would likely suspend deliveries to CarLotz due to market conditions, including rising wholesale prices; and (vi) as such, Defendants’ positive statements about the business, operations and prospects of CarLotz were materially misleading and / or unfounded.

The story goes on

On March 15, 2021, CarLotz announced its fourth quarter and full year 2020 financial results. During a related conference call, CarLotz stated that gross profit and GPU were “softer than … expected” due to the “increase in inventory levels during the quarter and the resulting lower profitability of retail units.” CarLotz also reported that the extra inventory “created a jam that resulted in slower processing and higher sales days”. As a result of this news, CarLotz’s share price fell more than 8%.

Then, on May 10, 2021, CarLotz announced its financial results for the first quarter of 2021, which revealed that the GPU was below expectations. Specifically, CarLotz had expected a retail GPU between $ 1,300 and $ 1,500 but reported $ 1,182. As a result of this news, CarLotz’s share price fell more than 14%.

Finally, on May 26, 2021, CarLotz announced an update to its with-profits sourcing partner agreement. Specifically, CarLotz announced that its “Profit Sharing Partner for Company Vehicle Procurement has informed the company that it has suspended deliveries to the company in light of current wholesale market conditions”. In addition, this partner accounted for “more than 60% of the cars sold and procured” in the first quarter of 2021 and “less than 50% of the cars sold and about 25% of the cars procured” in the second quarter of 2021 to date. As a result of this news, CarLotz’s share price fell another 13%, which did further damage to investors.

Robbins Geller Rudman & Dowd LLP has established a special SPAC Task Force to protect investors in blank check companies and seek redress for corporate misconduct. The SPAC Task Force consists of experienced litigation attorneys, investigators and forensic accountants and is dedicated to detecting and prosecuting fraud on behalf of aggrieved SPAC investors. The rise in blank check funding poses unique risks for investors. Robbins Geller Rudman & Dowd LLP’s SPAC Task Force is the vanguard in ensuring integrity, honesty and equity in this rapidly evolving area of ​​investment.

LEAD ACTION: The Private Securities Litigation Reform Act of 1995 allows any investor who purchased CarLotz securities during the class action period to seek appointment as the lead plaintiff in the CarLotz class action. A lead plaintiff is usually the applicant with the greatest financial interest in the legal protection sought by the alleged class, which is also typical and appropriate for the alleged class. One lead plaintiff is acting on behalf of all of the other class plaintiffs in directing the CarLotz class action. The lead plaintiff can choose a law firm of their choice to bring the CarLotz class action lawsuit. An investor’s ability to participate in a possible future recovery of the CarLotz class action lawsuit does not depend on whether or not they are the lead plaintiff.

ABOUT ROBBINS GELLER RUDMAN & DOWD LLP: With 200 attorneys in 9 offices across the country, Robbins Geller Rudman & Dowd LLP is the largest US law firm serving investors in securities class actions. Robbins Geller’s attorneys have secured many of the largest shareholder recoveries in history, including the largest securities class action of all time – $ 7.2 billion – in In re Enron Corp. Sec. Lit. The 2020 ISS Securities Class Action Services Top 50 Report ranked Robbins Geller first for getting $ 1.6 billion back for investors last year, more than double the amount paid by any other securities plaintiff firm was drafted. Please visit https://www.rgrdlaw.com/firm.html for more information.

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Contact:
Robbins Geller Rudman & Dowd LLP
655 W. Broadway, San Diego, CA 92101
JC Sanchez, 800-449-4900
[email protected]

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/91757

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