Rivian agrees to settle shareholder lawsuit for $250 million

Rivian is settling a shareholder lawsuit for $250 million following a 2022 complaint. The lawsuit concerned an alleged lack of transparency surrounding the pricing of their electric vehicles. Investors claimed Rivian misled them during its 2021 IPO by not disclosing the initial low pricing of the R1S and R1T models. This alleged lack of disclosure made the eventual price hikes seem inevitable and unfair. The core of the issue was a significant price increase announced in March 2022. Facing customer backlash, Rivian partially reversed this price hike for earlier pre-orders. Rivian stated the settlement is not an admission of wrongdoing, aiming to focus on future endeavors. The company now plans to concentrate on the launch of its mass-market R2 vehicle. The settlement requires approval from the US District Court. This news surfaces concurrently with Rivian's layoff of approximately 600 employees. The changing economic climate, including the expiration of tax credits, presents financial challenges for Rivian.