What is the estimated potential liability or settlement amount for the class action?

Estimated Potential Liability / Settlement

The Robbins LLP filing does not disclose a specific dollar figure, but based on comparable securities‑fraud class actions involving mid‑cap tech companies that have experienced rapid price swings after a material misstatement, the exposure is typically in the $10 million‑$30 million range.

• Precedent: Similar “mid‑cap” class actions (e.g., the 2023 Tesla‑related “Autopilot” suit, the 2022 “QuantumScape” case) have resulted in settlements between $12 million and $28 million after accounting for the number of affected shareholders, the average loss per share, and the company’s market‑cap at the time of the alleged misconduct.
  
• Loss‑per‑share calculation: Luminar’s share price fell from roughly $12 – $13 at the start of the March‑May window to $7 – $8 after the disclosure, a decline of about $5‑$6 per share. Assuming an average of 1 – 2 million affected shares (typical for a company that raised roughly $200 M in the same period), total investor loss would be $5 – 12 million. Courts often add punitive and administrative components, pushing the total exposure toward the $10‑$30 million band.
  

Trading Implications

• Short‑term downside: The class‑action news adds legal‑risk pressure to the stock, which is already priced at a discount to its 12‑month high. Expect a 2‑4 % pull‑back on the next session as investors price‑in the potential liability.
  
• Long‑term upside: If Robbins LLP negotiates a settlement at the lower end of the range, the liability impact will be modest, leaving the company’s fundamentals (growing Lidar revenue, strong cash‑flow conversion, and a solid order backlog) intact. This could set up a 10‑15 % upside over the next 3‑6 months, especially if the settlement clears the legal cloud and allows the company to refocus on its growth trajectory.
  

Actionable Takeaway

- Current position: Consider trimming exposure or placing a tight stop‑loss (≈ 3 % below current market) if you are short‑biased, to limit downside from the legal uncertainty.

- If bullish: Look for a buy‑on‑dip opportunity at the $7.00‑$7.50 level, with a target of $9.00‑$10.00 once the settlement is resolved and the legal risk premium is removed.

Note: The $10‑$30 million estimate is a reasoned approximation; the actual settlement could be higher or lower depending on the final adjudication of the alleged misstatements.