What is the timeline for the lawsuit's key milestones (e.g., filing, discovery, trial) and how might that drive volatility?

Timeline & Volatility Triggers

- Filing (Aug 11 2025): The lawsuit was filed today. In the first 48‑72 hours the stock is likely to see the sharpest move – a typical “announcement‑shock” that often squeezes the price 5‑10 % lower on heavy volume as short sellers and risk‑averse investors exit. Expect heightened implied‑volatility (IV) spikes in the near‑term options chain, especially for out‑of‑the‑money (OTM) puts.

- Discovery & Motions (Sep 2025 – Oct 2026): Discovery in securities‑class actions usually runs 6‑12 months, with periodic “discovery‑phase” filings (interrogatories, depositions) that can spark short‑term spikes each time a docket entry is released. Expect modest “spike‑and‑recover” patterns roughly every 2‑3 months as the court releases filings or the parties file motion‑to‑dismiss arguments. During this window the stock often trades in a tighter range (≈ ±3 % from current levels) but with recurring volatility spikes on news releases.

- Pre‑Trial/Settlement (Nov 2026 – Mar 2027): Most shareholder‑rights cases settle before trial. If a settlement window opens (e.g., a “notice of settlement” filing) the stock typically rebounds 3‑7 % as investors price in a potential payout. If no settlement is reached, the case proceeds to trial (likely mid‑2027). The trial date itself (often a single day or a short week of hearings) normally triggers the highest single‑day volatility, as investors price the “all‑or‑nothing” outcome. IV for the nearest expiration (6‑12‑month contracts) can double, creating profitable opportunities in straddles/strangles.

Trading Implications

- Short‑Term: Enter defensive put spreads or buy OTM puts immediately after the Aug 11 filing to capture the initial sell‑off; the steep drop and inflated IV make credit spreads cheap.

- Mid‑Term: Monitor docket releases (e.g., “motion to dismiss” filed in Q4 2025). A win for the plaintiff can lift the stock 2‑4 % and raise IV; a dismissal can push the stock 2‑3 % lower. Use a tight‑range straddle (e.g., Jan‑2026 ATM) to capture repeated volatility spikes.

- Long‑Term: If the case reaches the settlement window (late 2026) and no settlement emerges, position a long‑dated calendar spread (buy longer‑dated calls, sell near‑term) to capture a potential rally while protecting against a trial‑day plunge. Keep stop‑losses near the recent support line (≈ $8.20) and watch for a break below $7.80, which could signal an escalation of negative sentiment and further downside bias.

Overall, the lawsuit creates a multi‑phase volatility pattern: a sharp initial drop, periodic mid‑stage spikes, and a final “event‑risk” peak around a trial or settlement. Positioning for each phase—via options‑based volatility plays—offers the highest risk‑adjusted upside.