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According to the complaint, Pentwater Capital Management LP (“Pentwater” or the “Investment Firm”) was Avis’ second largest shareholder, holding 2.95 million shares, or approximately 8.4%, of Avis’ outstanding stock as of June 30, 2025. Defendants devised a plan to manipulate the market by buying up significant shares of Avis while it was being heavily shorted, generating a short squeeze. The resulting rapid price escalation would then force short sellers to close their positions by purchasing additional shares, compounding the upward pressure on the stock and allowing defendants to reap the benefits of Avis’ artificially increased share price. Defendants act of manipulation was to buy out a significant portion of Avis’ outstanding shares while further increasing its economic stake through additional put options and calls. Defendants did so despite no significant change to Avis’ fundamentals that would justify sharply increasing their stake in the Company. On April 22 and 23, 2026, Pentwater finalized its scheme, selling a significant portion of the Avis shares it had acquired since February, approximately 4.3 million shares, realizing gains of about $1.75 billion. The stock price reacted in accord: from a closing price of $713.97 on April 21, 2026, to a closing price of $229.14 on April 23, 2026, the stock had collapsed by $484.83. Pentwater’s sharp stock sale had triggered a nearly 68% decline in Avis’ stock price in just two days. By April 30, 2026, Pentwater had sold more than 5 million shares of Avis’ stock in only a month as indicated by a Schedule 13G/A filing from the Investment Firm. Pentwater divested its share down to only 7.3% of Avis’ holdings. Pentwater attested it now held approximately 2.59 million shares of Avis’ stock. In reaction to the filing, Avis’ stock price fell further to a closing price of $145.75 on May 8, 2026. The stock fell nearly $570 from its peak on April 21, 2026, a nearly 80% decline in stock price in just over two weeks.
In order to be eligible to join the CAR class action lawsuit, you must have incurred a loss on shares of Avis Budget Group, Inc. purchased during the class period listed above.
If you suffered a loss in Avis Budget Group, Inc. during the relevant time frame or pursuant to the relevant offering(s), you have until September 29, 2026 to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as a lead plaintiff.
● The Allegation: The complaint alleges that Pentwater Capital Management LP, Avis' second-largest shareholder, orchestrated a market manipulation scheme by aggressively accumulating Avis shares to trigger a short squeeze, then rapidly dumping approximately 4.3 million shares to reap roughly $1.75 billion in gains, despite no change in Avis' underlying fundamentals to justify the buildup.
● The Stock Drop: On April 23, 2026, CAR fell $484.83 (approximately 68%) to close at $229.14 per share over two days, after Pentwater allegedly sold about 4.3 million shares on April 22 and 23; the stock later fell further to $145.75 per share on May 8, 2026, nearly 80% below its April 21, 2026 peak, after a filing revealed Pentwater had divested more than 5 million shares.
● Class Period & Defendants: The class period runs from February 20, 2026 through April 21, 2026, inclusive. The named defendants are Pentwater Capital Management LP, MCH PWCM Holdings, Inc. (Pentwater's general partner), and Matthew C. Halbower (Chief Executive Officer and President of MCH PWCM Holdings, Inc.).
● Lead Plaintiff Deadline: The application deadline is September 29, 2026. Investors who wish to seek appointment as lead plaintiff must apply by the deadline.
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Avis Class Action Summary |
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Company |
Avis Budget Group, Inc. (NASDAQ: CAR) |
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Lead Plaintiff Deadline |
September 29, 2026 |
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Class Period |
February 20, 2026 – April 21, 2026 |
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Stock Drop |
April 23, 2026 – CAR fell $484.83 (68%) to $229.14 |
A securities class action has been filed on behalf of investors in Avis Budget Group, Inc. (NASDAQ: CAR). The case was brought by plaintiff Roni Arjang with Levi & Korsinsky, LLP. The class period runs from February 20, 2026 through April 21, 2026.
The complaint alleges the defendants used manipulative trading to artificially inflate Avis' stock price. Pentwater Capital Management LP allegedly bought up a large share of Avis stock to trigger a short squeeze. It then allegedly sold those shares fast, once the price had soared, to lock in massive gains.
According to the complaint, the alleged scheme caused sharp losses for investors. Avis stock surged to $713.97 on April 21, 2026. It then collapsed by about 68% in just two days after Pentwater allegedly sold roughly 4.3 million shares. The complaint alleges investors who bought at inflated prices suffered losses.
Avis Budget Group, Inc. is a Delaware corporation headquartered in Parsippany, New Jersey, operating in the vehicle rental sector. During the class period, its common stock traded on the NASDAQ under the symbol "CAR." The complaint names Avis as a nonparty; the defendants are Pentwater Capital Management LP, a private investment firm founded in April 2007, its general partner MCH PWCM Holdings, Inc., and Matthew C. Halbower.
February 20, 2026–April 21, 2026
Investors who purchased or otherwise acquired Avis securities, or sold Avis securities short, during the Class Period may be eligible to seek recovery under the federal securities laws.
The complaint alleges that Pentwater Capital Management LP devised a plan to manipulate the market for Avis common stock by buying up a significant portion of Avis' outstanding shares while the stock was being heavily shorted, generating a short squeeze. As Avis' second-largest shareholder, Pentwater held approximately 8.4% of the Company's stock as of June 30, 2025, a stake that had historically ranged between roughly 6% and 9%. The lawsuit claims the defendants acted despite no significant change to Avis' fundamentals that would justify sharply increasing their stake.
According to the complaint, Pentwater disclosed in a Form 3 filed February 24, 2026, that as of February 20, 2026, it had crossed the 10% ownership threshold, attesting to 3,562,100 shares. Over the following weeks, the complaint states, Pentwater rapidly increased its holdings: a Schedule 13G/A filed March 6, 2026, reported 12.3% ownership, and an April 7, 2026 filing reported 7,824,100 shares, or 22.2% of Avis' outstanding shares. The complaint alleges this swift accumulation depleted the available float and forced short sellers to buy additional shares to cover their positions, creating a self-reinforcing feedback loop that compounded upward pressure on the stock.
The complaint alleges the price escalation resulted solely from Pentwater's manipulative trading and the resulting distortion of market mechanics, not from any change in Avis' underlying economic value. The lawsuit claims Pentwater's trading served no legitimate economic purpose other than to artificially distort the price of Avis stock to force a short squeeze, from which the defendants intended to, and did, reap illicit profits. It further alleges that Matthew C. Halbower, who executed Pentwater's SEC filings both individually and as Chief Executive Officer of the general partner, exercised direct control over Pentwater's trading strategies and regulatory filings.
The complaint alleges the defendants acted with scienter, knowing or recklessly disregarding that their buying behavior would send Avis shares into a significant short squeeze given the Company's high short-interest-to-float ratio. It further alleges that, according to Avis management, Pentwater acknowledged that its sale of Avis stock was at least in part violative of the SEC Section 16 short-swing profit rules, deliberately disregarding regulatory guardrails to achieve the fruits of the alleged scheme.
According to the complaint, the alleged scheme came to fruition when Pentwater reversed course and sold. Over a two-day span from April 22 to April 23, 2026, the complaint states, Pentwater sold approximately 4.3 million shares of Avis stock, generating proceeds of about $1.75 billion. The complaint alleges this rapid liquidation of shares acquired just weeks earlier revealed that Pentwater had no intention of reinforcing a long-term position in the Company.
During an earnings call on April 29, 2026, Avis Chief Executive Officer Brian J. Choi addressed the volatility and pointed to Pentwater's trading as its source. The complaint quotes Choi as stating that Avis had not bought or sold a share since 2024 and that its largest shareholder had not traded since 2023, leaving Pentwater as the only insider active during the period of excess volatility. Choi further stated that Pentwater had acknowledged its sale was at least in part violative of the SEC Section 16 short-swing profit rules and that Avis would aggressively pursue all rights on behalf of stockholders.
Analysts reacted swiftly. The complaint notes that Jefferies downgraded Avis to Hold and cut its price target 11%, citing volatility tied to the activity of one of the Company's largest shareholders and the unwind of a historically large short squeeze. JPMorgan similarly lowered its target EBITDA multiple, confirming that Avis had not issued new shares under its March prospectus and that Pentwater's selling of existing shares, not any corporate action, had eased the squeeze.
The complaint details a dramatic rise and collapse in Avis' stock price. From a closing price of $92.90 per share on February 25, 2026, the stock surged to close at $713.97 on April 21, 2026, a staggering 668.5% increase over roughly two months. The rapid climb caused investors to purchase Avis common stock at what the complaint alleges were wildly inflated prices.
The reversal was equally sharp. After Pentwater allegedly sold approximately 4.3 million shares on April 22 and 23, 2026, Avis stock collapsed from $713.97 on April 21, 2026, to $229.14 on April 23, 2026, a decline of $484.83, or nearly 68%, in just two days. The stock fell further to close at $145.75 per share on May 8, 2026, after a Schedule 13G/A filing revealed Pentwater had divested more than 5 million shares, leaving the stock nearly $570, or roughly 80%, below its April 21 peak.
● Lead Plaintiff Deadline: September 29, 2026
● After the lead plaintiff deadline, the Court will consider any lead plaintiff motions.
● Defendants may file a motion to dismiss.
● If the case proceeds, the Court may later consider class certification.
Disclaimer: This shareholder alert is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for personalized guidance. Prior results do not guarantee similar outcomes.
The securities class action alleges that Pentwater Capital Management LP, Avis' second-largest shareholder, orchestrated a market manipulation scheme involving Avis Budget Group (NASDAQ: CAR) common stock. According to the complaint, Pentwater aggressively accumulated Avis shares between February and April 2026 to trigger a short squeeze, artificially inflating the stock price despite no change in Avis' fundamentals. The lawsuit claims the defendants then rapidly sold roughly 4.3 million shares, realizing approximately $1.75 billion in proceeds, which the complaint alleges caused the stock to collapse and left investors who bought at inflated prices with losses under the federal securities laws.
The complaint names three defendants: Pentwater Capital Management LP, a private investment firm; MCH PWCM Holdings, Inc., which serves as Pentwater's general partner; and Matthew C. Halbower, the Chief Executive Officer and President of MCH PWCM Holdings, Inc. According to the complaint, Halbower served as the signatory of record on Pentwater's SEC filings related to its Avis stock holdings and exercised direct control over Pentwater's trading strategies. Avis Budget Group itself is named as a nonparty in the lawsuit rather than as a defendant.
The class period runs from February 20, 2026 through April 21, 2026, inclusive. According to the complaint, this period covers investors who purchased or acquired Avis securities, including purchasers of swaps and those who bought common stock to cover short positions, as well as those who sold Avis securities short. The complaint alleges that during this window, the defendants' manipulative trading artificially inflated the price of Avis common stock before the alleged scheme was revealed through Pentwater's rapid share sales in late April 2026.
According to the complaint, Avis stock surged to close at $713.97 per share on April 21, 2026. After Pentwater allegedly sold approximately 4.3 million shares on April 22 and 23, 2026, the stock collapsed to close at $229.14 on April 23, 2026, a decline of $484.83, or nearly 68%, in just two days. The complaint states the stock fell further to $145.75 per share on May 8, 2026, after an additional filing revealed Pentwater had divested more than 5 million shares, leaving the stock roughly 80% below its April 21 peak.
A short squeeze occurs when rising share prices force investors holding short positions to buy shares to cover potential losses, which pushes prices even higher. The complaint alleges Pentwater exploited Avis' high short-interest-to-float ratio by aggressively accumulating a dominant position, depleting the available float. This allegedly forced short sellers into a feedback loop of panicked covering, artificially inflating the price. The lawsuit claims the defendants then capitalized on the resulting price peak by rapidly selling their recently acquired shares to the investing public.
According to the complaint, during an earnings call on April 29, 2026, Avis Chief Executive Officer Brian J. Choi addressed the stock's volatility and pointed to Pentwater's trading as its source. Choi noted that Avis had not bought or sold a share since 2024 and its largest shareholder had not traded since 2023, leaving Pentwater as the only active insider during the period. The complaint states Choi said Pentwater had acknowledged its sale was, at least in part, violative of the SEC Section 16 short-swing profit rules, and that Avis would aggressively pursue all rights on behalf of stockholders.
Investors who purchased or otherwise acquired Avis securities, or sold Avis securities short, during the Class Period may be eligible. The lead plaintiff deadline is September 29, 2026. Investors who wish to seek appointment as lead plaintiff must apply by the deadline. The lead plaintiff typically is the investor or group with the largest financial interest in the case who is otherwise adequate and typical of the class. Investors do not need to serve as lead plaintiff to potentially share in any recovery obtained for the class.
The complaint asserts claims under Section 10(b) of the Securities Exchange Act and Rules 10b-5(a) and (c) promulgated thereunder against all defendants. Unlike many securities cases based on false statements, this lawsuit focuses on alleged manipulative acts and a deceptive course of conduct rather than misrepresentations. According to the complaint, the defendants employed devices, schemes, and artifices to defraud that operated as a fraud on purchasers of Avis common stock, and acted with scienter by knowing or recklessly disregarding that their conduct would artificially manipulate the market for the security.
The class action alleges Pentwater manipulated Avis Budget Group (CAR) stock by buying shares to trigger a short squeeze, then rapidly sold roughly 4.3 million shares for about $1.75 billion, which the complaint alleges caused the stock to collapse.
The defendants are Pentwater Capital Management LP, MCH PWCM Holdings, Inc. (its general partner), and Matthew C. Halbower, Chief Executive Officer and President of MCH PWCM Holdings. Avis Budget Group is named as a nonparty.
The class period runs from February 20, 2026 through April 21, 2026, inclusive, covering investors who purchased Avis securities or sold them short during that window.
Avis stock fell from $713.97 on April 21, 2026, to $229.14 on April 23, 2026, a drop of $484.83 (nearly 68%), then declined further to $145.75 per share by May 8, 2026.
Investors who purchased or otherwise acquired Avis securities, or sold Avis securities short, during the class period may be eligible. The lead plaintiff deadline is September 29, 2026. Investors who wish to seek appointment as lead plaintiff must apply by the deadline.
Deadline
Sep 29, 2026