QuantumScape could take legal action after it was attacked in a damning report released by activist short-seller Scorpion Capital.
“We’re definitely going to look into that,” said Jagdeep Singh, QuantumScape chief executive, when CNBC’s Jim Cramer asked if the company would consider suing the company.
“Some of the points in there are just, just absurd. Absurd to the point that there are… things we would like to take legal action for.
Singh appeared on “Mad Money” on Friday, a day after Scorpion published the short report. In the 188-page report, Scorpion accused QuantumScape – which became public in November through a blank check merger – of functioning as a “pump and dump SPAC.” It even compared the company to Theranos, the disgraced health technology start-up.
QuantumScape shares fell more than 12% after the information was released. The stock fell again on Friday, contributing to a 28% drop in less than two weeks.
“We don’t want to be too distracted either, but you know, we feel pretty good about where we are,” Singh said.
The battery company said it stands behind the data it has presented to investors and will continue to build a battery for its customers, such as Volkswagen, which recently invested an additional $ 100 million in the company.
QuantumScape argued that Scorpion was motivated to publish the report because it will benefit financially from the subsequent fall in the stock price. Investors who try to make a profit from a sharp fall in the stock price are called short sellers.
“We have always been quite transparent about what we have and the work that remains to be done,” said Singh. “To be honest, that’s one of the things we’re proud of. We think we’re the most transparent of all semiconductor battery manufacturers.”