Electric-vehicle trucking startup $(RIVN.US)$ is going to become a publicly-traded company soon. Its valuation after its initial public offering could make it the second most valuable EV company on earth, next to $Tesla(TSLA.US)$. The EV leader, however, has a problem with some of Rivian's technology. Tesla believes it's theirs.
Tesla, according to a legal complaint filed in July, believes Rivian misappropriated "Tesla's trade secret[s], confidential and proprietary information by recruiting by Tesla employees and encouraging them to take such information as they leave Tesla." Tesla says it discovered several instances of employees leaving for Rivian taking information that violates "non-disclosure obligations."
It's difficult to know if legal issues will ultimately impact either company's stock price. The complaint mentions documents that are related to employee recruitment and pay. Those don't seem to be investor-level issues. Manufacturing trades secrets were mentioned in the complaint, too. Those might be bigger deals. Still, that amounts to speculation.
Many lawsuits are disclosed in SEC filings. They are generally items for investors to watch. $Beyond Meat(BYND.US)$), for instance, has been litigating a trade-secret dispute since 2017. The legal action didn't hold up Beyond's IPO or become a big issue for investors. Rivian's lawsuit will get more scrutiny since it is planning to go public.
Beyond held its IPO in May 2019, selling shares at $25. The stock closed Monday at $101.23.
Rivian, according to reports, might be valued at up to $80 billion after its IPO. That would make it the second most valuable EV firm. Tesla, of course, is the most valuable with a market capitalization of almost $800 billion. $NIO Inc(NIO.US)$ would be third with a market cap of about $55 billion. $Byd Company Limited(01211.HK)$ makes a lot of EVs, but it does other things, too, and has a market cap north of $100 billion.
Write to Al Root at allen.root@dowjones.com
(END) Dow Jones Newswires
October 05, 2021 10:03 ET (14:03 GMT)
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