Below is an article published today in my TD Ameritrade account about a law firm considering a lawsuit against Tesla Motors regarding claims of safety before the car fires. Supposedly they want to represent shareholders, but the actual effect may be more of a benefit for short sellers. Following the article is my response to the law firm. Other shareholders here may want to consider sending a similar email to the law firm at
[email protected] .
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SHAREHOLDER ALERT: Pomerantz Law Firm Investigates Claims on Behalf of Investors of Tesla Motors, Inc. -- TSLA
11:32a ET October 30, 2013 (GlobeNewswire)
Pomerantz Grossman Hufford Dahlstrom & Gross LLP is investigating claims on behalf of investors of Tesla Motors, Inc. ("Tesla"). Such investors are advised to contact Robert S. Willoughby at
[email protected] or 888-476-6529, ext. 237.
The investigation concerns whether Tesla and certain of its officers and/or directors have violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. In an August 19, 2013 press release, Tesla touted its Model S as having achieved the "best safety rating of any car ever tested" by the National Highway Traffic Safety Administration ("NHTSA"). On October 2, 2013, an analyst downgraded Tesla due to "execution risk." On October 17, 2013 in Merida, Mexico, a Model S sped into a roundabout, crashed through a concrete wall and hit a tree. The driver fled the scene before the car went up in flames. The U.S. automotive Web site Jalopnik reported the story Monday, citing the Mexican newspaper Progreso Hoy.
It was the second time this month that a Model S - (Tesla's only vehicle on the market) was in a fiery crash. On October 2, 2013, a Model S burned after hitting road debris in Kent, Washington.
On this news, shares of Tesla fell 4 percent to close at $162.86 on October 28, 2013. The shares have fallen 16 percent since the October 2 crash.
Pomerantz Grossman Hufford Dahlstrom & Gross LLP, with offices in New York, Chicago, San Diego and Florida, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See
Pomerantz Law | Front.
| CONTACT: Robert S. Willoughby
Pomerantz Grossman Hufford Dahlstrom & Gross LLP
[email protected]
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|
Dear PGHDG:
I’m a Tesla Motors shareholder. You’ve got to be kidding regarding your investigation of the company. Stop now. Any potential gains from a lawsuit would be miniscule compared to share price drops due to publication of your intentions. You actually would be helping the short sellers and hurting the shareholders. If your ulterior motive is actually to aid the former, then we shareholders should be suing you.
There are hundreds of car fires in the US every day. Many involve death or severe injury. The Tesla fires were contained to the front of the batteries due to a safety design that compartmentalized the batteries. There were no injuries. Both drivers still love the Model S and are anxious to get replacements.
The Tesla fires were the result of unusual accidents, not spontaneous as in the case of a Fisker car. The first one involved running over a truck fender that jackknifed forcing puncture with a force of 25 tons. The NHTSA says it’s not worth further investigation since there was no safety defect. The second involved a drunk who ran the car at high speed into a wall.
The fact that the fires were freakish accidents, contained and the drivers were unhurt screams that the Model S is well designed for safety and is indeed the world’s safest car. If any party needs to be investigated and considered for a lawsuit, it is your firm.
Regards,
Curt Renz