Battery Firm Stem’s Leaders Should Get Suit Tossed, Judge Urges

Stem Inc. investors failed to plead securities claims against the company’s blank-check merger sponsor and individual directors and executives with sufficient specificity, a judge said in recommending dismissal.

The derivative suit’s allegations of a misleading proxy statement in connection with the deal that brought the company public amount to an impermissible “puzzle pleading,” Magistrate Judge Christopher J. Burke said Jan. 31 in a report to the US District Court for the District of Delaware. A proposed class action over some of the same issues remains pending in the Northern District of California after a non-final dismissal ruling.

• The investors sued ...