"Rivian Automotive Inc. must defend against shareholder allegations the electric-vehicle maker overstated demand based on misleading preorder backlog numbers.

Investors sufficiently alleged that top executives were watching the backlog metrics “daily,” boosting an inference of intent or reckless disregard, Judge Consuelo B. Marshall said in an order entered Thursday.

CEO Robert J. Scaringe and CFO Claire McDonough’s compensation being heavily tied to the stock’s value bolstered that inference, the US District Court for the Central District of California judge said. Scaringe’s $13.99 million paid in 2023 was 5% salary and 95% stock and options, Marshall said based on the allegations, ...”

 

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This article was originally published in Bloomberg Law.