#United States #San Diego #Class Action #Red Cat Holdings #RCAT

Investors Urged to Join Red Cat Holdings Class Action Lawsuit

In light of recent developments, investors who acquired securities of Red Cat Holdings, Inc. (NASDAQ: RCAT) between March 18, 2022, and January 15, 2025, are encouraged to step forward and lead a class action lawsuit against the company and certain executives. Robbins Geller Rudman & Dowd LLP is spearheading these efforts and has made a formal announcement detailing the process for potential lead plaintiffs.

This class action lawsuit, captioned Olsen v. Red Cat Holdings, Inc., accuses Red Cat and specific executives of violating the Securities Exchange Act of 1934. If you have suffered significant losses as a result of purchasing or acquiring these securities during the specified period, you may want to consider asserting your rights in court.

Allegations Against Red Cat Holdings

The allegations being leveled against Red Cat Holdings revolve around inflated claims regarding its production capacity and project values. The company, along with its subsidiaries, designs and manufactures drone products. Among its offerings is the “Teal 2” drone, intended for military use, which has been promoted heavily in the media.

The class action complaint highlights that throughout the class period, Red Cat allegedly made misleading statements regarding the production capabilities of its facility located in Salt Lake City and the actual value of its Short Range Reconnaissance Program of Record Tranche 2 contract. This has led investors to believe that the company was positioned for significantly more production than reality suggested.

For instance, a release from Red Cat on July 27, 2023, disclosed that its Salt Lake City facility had an actual production capability of only 100 drones monthly, a stark contrast to earlier claims suggesting expected production levels could reach 1,000 drones under the right conditions. Following this revelation, Red Cat's stock experienced a substantial drop, declining nearly 9% on the news.

On further occasions, notably September 23, 2024, Red Cat reported significant losses in its first fiscal quarter, which exacerbated the situation. The losses amounted to $0.17 per share, which was considerably below analysts’ expectations, triggering another stock price decline of over 25%. The company disclosed ongoing issues related to its manufacturing processes that adversely affected the production of the Teal 2 units.

Additionally, a report from Kerrisdale Capital on January 16, 2025, further indicated that the value of the SRR contract was overstated and questioned the feasibility of Red Cat operating a mass-production facility at a budgetary norm.

How to Get Involved as a Lead Plaintiff

The Private Securities Litigation Reform Act of 1995 permits any investor fitting the criteria to seek appointment as a lead plaintiff in this class action. Being a lead plaintiff involves representing all affected investors and having significant input in directing the course of the lawsuit. Importantly, participating as a lead plaintiff does not affect your eligibility to receive any financial recoveries from the case.

If you would like to take this opportunity, potential lead plaintiffs should ensure they submit their information by July 22, 2025. For further assistance, interested parties can contact the Robbins Geller law firm through their official website or get in touch with attorneys J.C. Sanchez or Jennifer N. Caringal directly.

About Robbins Geller Rudman & Dowd LLP

Robbins Geller is renowned for its commitment to representing investors in securities fraud cases and shareholder litigation. With a strong track record, the firm has secured substantial monetary relief for investors, making it an authoritative presence in this sector. In 2024, it successfully recovered over $2.5 billion for its clients.

Investors affected by the actions of Red Cat Holdings have the chance to assert their rights and potentially recover their losses through this legal mechanism. Do not miss this window of opportunity to act before it closes.

For more detailed information regarding this class action lawsuit and how to participate, you may visit Robbins Geller's website or call 800-449-4900.

Date: July 3, 2025