A class action lawsuit has been filed to recover damages for investors in YayYo (YAYO) stock regarding alleged violations of federal securities laws.
If you have losses traceable to the YayYo (YAYO) initial public offering (IPO), contact Silver Law Group for a confidential no-cost consultation at (800) 975-4345 or by email at email@example.com.
A lead plaintiff (class representative) has not been selected and a class has not been certified in this case.
YayYo operates “Rideshare Platform”, which is a peer-to-peer booking platform that rents vehicles to rideshare drivers who drive for companies such as Uber and Lyft. They also operate a fleet of passenger vehicles that are rented to rideshare drivers on their platform.
YayYo (YAYO) Class Action Alleges False And Misleading Statements Regarding IPO
Ramy El-Batrawi founded YayYo in 2016 and served as its CEO or acting until February 1, 2019 when, according to the class action complaint, he resigned so the company could be taken public. His resignation was at the insistence of NASDAQ because of his “checkered past”. El-Batrawi claims to have been reappointed CEO and a member of the board on January 26, 2020.
YayYo completed its IPO (initial public offering) in November, 2019, selling 2.7 million shares at $4/share. Shortly after the IPO, the share price started a steep decline. As of this writing, the stock trades at $0.34/share. In February, 2020, the company was delisted from the NASDAQ exchange and now trades on the OTC Pink market with other “penny stocks”.
The class action lawsuit, filed in Unites States District Court Central District of California, names YayYo, El-Batrawi, and IPO underwriter Aegis Capital Corp as defendants, among others.
The complaint makes several allegations involving false or misleading statements and/or failure to disclose, including:
- That El-Batrawi did not sell his 12,525,000 shares and owned a controlling interest even after NASDAQ insisted that he own less than 10% equity pursuant to the listing agreement.
- That El-Batrawi continued to exercise “supervision, authority, and control over YayYo” and was deeply involved in the business’s operations and finances, including helping the underwriters in marketing the company’s IPO.
- That YayYo promised certain of its creditors that if they purchased shares in the IPO to help close the offering, YayYo would repurchase the shares after the IPO with funds from the IPO.
- That YayYo owed El-Batrawi $500,000 at the time of the offering.
- That YayYo owed almost half a million dollars in unpaid social media costs, many of which were overdue at the time of the IPO.
The complaint alleges that due to the false and/or misleading statements and/or failure to disclose the information above, investors purchased YayYo stock at “artificially inflated prices”, and that the decline in price was caused by it being revealed, and that investors should be able to recover damages as a result.
Did You Invest In YayYo?
Silver Law Group represents the investors who have lost money due to investment fraud. Our attorneys represent investors across the country in class action lawsuits against issuers and in securities arbitration claims against brokers.
Scott Silver, managing partner of Silver Law Group, is the chairman of the Securities and Financial Fraud Group of the American Association of Justice. Please contact Scott Silver for a no cost consultation at firstname.lastname@example.org or toll free at (800) 975-4345.