Ginkgo Bioworks Holdings, Inc. f/k/a Soaring Eagle Acquisition Corp.
The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Northern District of California on behalf of those who acquired Ginkgo Bioworks Holdings, Inc. f/k/a Soaring Eagle Acquisition Corp. (“Ginkgo” or the “Company”) (NYSE: DNA) securities from May 11, 2021 through October 5, 2021, inclusive (the “Class Period”). Investors have until January 18, 2022 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
Ginkgo purportedly operates a horizontal platform for cell programming, designed to enable biological production of products as diverse as novel therapeutics, key food ingredients, and chemicals currently derived from petroleum. Ginkgo Bioworks Holdings went public via a deSPAC transaction with blank check company Soaring Eagle Acquisition Corporation in September 2021.
On October 6, 2021, before the market closed, short seller Scorpion Capital released a report alleging that Ginkgo Bioworks Holdings is a “colossal scam.” The 175-page report alleges that Ginkgo Bioworks’s business model is a “shell game,” and that the company is highly dependent on related party transaction revenues. The report charges that the company is a “Frankenstein mash-up of the worst frauds of the last 20 years.” On this news, Ginkgo’s stock price declined by $1.39 per share, or approximately 11.6%, from $11.98 per share to close at $10.59 per share on October 6, 2021.
The lawsuit alleges throughout the Class Period, Defendants made false and/or misleading statements and/or failed to disclose that: (1) the Company’s failure to derive real revenue from third-party customers left it almost completely dependent on related parties; (2) as a result, most, if not all, of the Company’s revenue came from related parties the Company created, funded, or controlled through its ownership and board seats; (3) the Company was misclassifying and underreporting related party revenue in order to conceal the Company’s near total-dependence on related parties; (4) many of the Company’s new R&D partners are undisclosed related parties and/or facades; (5) as a result, the Company’s valuation was significantly less than Defendants disclosed to investors; and (6) as a result, Defendants’ public statements were materially false and/or misleading at all relevant times.