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EV Startup Faraday Future Sued Over $3.4 Billion SPAC Merger

June 15, 2022, 9:34 PM

A Faraday Future Intelligent Electric Inc. shareholder filed suit in Delaware against the electric vehicle startup, its founder, members of its board, and financiers of the $3.4 billion blank-check merger that took it public, claiming the transaction was structured to shortchange public investors while giving insiders a windfall.

The lawsuit, filed Tuesday in Delaware’s Chancery Court, targets the July 2021 combination between Faraday and Property Solutions Acquisition Corp., a special purpose acquisition company sponsored by, among other investors, affiliates of Benchmark Real Estate Group LLC.

It accuses deal backers affiliated with both the SPAC and privately held Faraday—including founder Jia ...