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Steve Burns , the ousted laminitis , chairman and CEO of bankrupt EV startup Lordstown Motors , has settle with the U.S. Securities and Exchange Commission over misleading investor about need for the company ’s flagship all - electrical Endurance getaway hand truck .
Burns was regulate to pay a civil fine of $ 175,000 and can not assist as an officer or director of a public society for two years , harmonize to the agreementfiled with the U.S. District Court for the District of Columbia . Without admitting or traverse the SEC ’s allegations , Burns consented to a permanent injunction , the fine and other stipulations in the understanding , according to the SEC .
The SECcharged Lordstown Motorsin February 2024 with misleading investors about the sales event prospects of its Endurance electric pickup arm truck . The companionship correspond to pay $ 25.5 million . At the meter , it was n’t clean that the SEC was also going after Burns .
Lordstown Motors was founded in April 2019 as an offshoot of Burns ’ other companionship , Workhorse Group . The company went public the follow year via a fusion with a special determination acquisition company DiamondPeak Holdings Corp. , with a market value of $ 1.6 billion . During and after the fusion , Lordstown received $ 780 million from investors , according to the SEC .
The company was among a batch of EV startup that go public via fusion with blank - check fellowship in 2020 and enjoy skyrocketing share price that soon come down back to earth as they cope with the challenge of producing and selling electric vehicles . Lordstown Motors attracted the attending and investment of GM and even acquired the 6.2 - million - square - foot assembly plant in Lordstown , Ohio , from the automaker .
By June 2020 , Lordstown was rally high after revealing its Endurance galvanising getaway in a flamboyant and political - leaning ceremony that featured former frailty president Mike Pence , who verbalise for 25 hour about former President Trump ’s policies on jobs and manufacturing , China and the COVID-19 response .
Burns secernate the crowd that it had receive 20,000 pre - Order , a figure that would have locked in the full first year of output if every client who pre - ordered the motortruck followed through and bought the vehicle . Burns later tell the company had received 100,000 nonbinding pre - orders from commercial fleet customers .
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Short - vender research business firm Hindenburg Researchdisputed those claims , and ultimately Burns , along with other executives , would resign by June 2021 .
The SEC later investigated the claims and said Lordstown Motors and Burns made deceptive argument about the stage business because most of the pre - orders were not defer by commercial fleet customer , but rather by troupe that did not operate fleets or intend to purchase the truck for their own consumption . This , the SEC says , make an unrealistic and inaccurate depiction of demand for the motortruck from commercial-grade fleet client .
Lordstown keep on a rocky road even after Burns go forth , and eventually file for Chapter 11 bankruptcy protection . In March , Lordstown Motorsemerged from bankruptcywith a new name and a nearly peculiar centering : uphold its causa against iPhone - maker Foxconn forallegedly“destroying the business of an American startup . ” The company is now get laid asNu Ride Inc.
Burns has also make a motion on since his resignation . In January , Burns launched anew company called LandX Motors .
