Caption: Black v. Canoo Inc., et al.
Case No.: 2:21-cv-02873-FMO-JPR
Jurisdiction: U.S. District Court, Central District of California
Judge: Hon. Fernando M. Olguin
Summary
On October 22, 2025, Judge Fernando M. Olguin granted defendants' motion to dismiss the Third Consolidated Amended Class Action Complaint in the securities class action against Canoo Inc. and its executives. The Court dismissed all claims in full. Leave to amend was denied.
Allegations Against Canoo Inc.
The complaint alleged that defendants made false or misleading statements regarding Canoo's phased go-to-market strategy, including revenue streams from engineering services, a subscription-based model for consumer vehicles, and an asset-light manufacturing strategy. Plaintiffs said these statements were issued in connection with Canoo's merger with a SPAC and a post-merger shelf offering of stock. The class period ran from December 21, 2020, through March 29, 2021.
Defendants’ Motion to Dismiss
Defendants Canoo Inc., Tony Aquila, Ulrich Kranz, and Paul Balciunas filed the motion to dismiss. They argued that the statements were not false or misleading, constituted puffery or forward-looking statements, and that the complaint failed to plead scienter with particularity.
Plaintiffs’ Opposition
Plaintiffs countered that defendants knew the engineering services revenue was unlikely to materialize and that the subscription and manufacturing strategies were under review for viability, making the statements actionable.
Court’s Ruling
The Court dismissed the Section 10(b) and Rule 10b-5 claims against all defendants. The Section 20(a) control-person claims were also dismissed.
Court’s Rationale
Falsity: The Court found that statements about engineering services revenue, the subscription model, and the asset-light manufacturing strategy were forward-looking projections or non-actionable puffery.
Scienter: The Court found that plaintiffs did not sufficiently allege a strong inference of intentional or reckless conduct (scienter) by the individual defendants with respect to the subscription and manufacturing statements, but did allege scienter sufficiently for the engineering services statements.
Loss Causation: The Court held that stock price declines were not sufficiently tied to revelations of the alleged misstatements.
Section 20(a): The claims were dismissed as derivative of the primary Exchange Act violations.
Case Status
The case has been dismissed with prejudice.
