An application for a class action lawsuit against Apollo Power (TASE: APLP) has been submitted to the Tel Aviv District Court. The solar energy technology company is accused of misleading investors by making a false report. The matter at hand is how its share price jumped by 150% on December 18 after Apollo announced it entered the cryptocurrency mining business.
Apollo Power, its chairman, CEO and directors are accused of gravely misleading investors by making an immediate report to the TASE which had crucial missing details. According to the application for a class action lawsuit, the accused “identified an attractive trend called blockchain.”
So, at the morning of the 18th, the company made a dramatic breaking announcement regarding an experiment in mining cryptocurrencies with its system. Investors were led to believe this was a breakthrough that will save significant electricity costs for miners, making the system more valuable.
With Bitcoin at over $19,000 and ether close to $800 that day, the stock price of Apollo shot up in price from 4.3 shekels to over 10 shekels immediately after this first report, as many investors regarded the announcement as credible and bought the stock. However, just six hours later Apollo made a second report which made it clear, according to class action application, that the first announcement was, “partial, false, misleading, fake, fraudulent and at the very least negligent.”