When is the lawsuit expected to progress to key milestones (e.g., discovery, settlement talks, or trial), and how should that timeline influence our position sizing and risk management?

Lawsuit timeline – what to expect

• Filing (29 Aug 2025). The case is now in the “complaint” stage. Courts typically set a discovery schedule 6–9 months after filing, so expect an order in Feb‑Mar 2026 compelling the company to produce documents, disclose internal communications and answer interrogatories.
  
• Settlement‑talk window. Once discovery heads is met, parties normally begin settlement discussions. In a securities‑fraud class action this phase usually opens 12–14 months after the complaint, i.e., mid‑2026 (around July‑Sept 2026).
  
• Trial or final resolution. If no settlement is reached, a bench trial is scheduled 18–24 months from filing, putting the likely trial date in early‑mid 2027. Historically, most cases settle before trial, so the “settlement‑or‑trial” inflection point will be the mid‑2026 milestone.

How the timeline should shape our trading plan

1. Immediate post‑filing (next 1–3 months). The market will price in the first‑order‑of‑magnitude risk—initial sell‑off, heightened volatility and a possible breach‑of‑trend on the daily chart. Keep the exposure light‑to‑moderate (5‑10 % of total portfolio) and use a tight stop (≈ 5‑7 % below current market price) to protect against a rapid‑down move as investors and short‑term traders exit.

2. Discovery window (Feb‑Mar 2026). As the company is forced to disclose internal records, earnings‑call transcripts and any “ex‑culpatory” material, price swings often intensify. If the disclosed data looks clean, the stock can rebound sharply; if it reveals material misstatements, the down‑trend can accelerate. Scale in modestly (10‑15 % of allocation) with a staggered entry—e.g., +‑10 % of the initial position on the first bounce, but keep a trailing‑stop set at 8‑10 % to lock‑in gains while still allowing upside if the case weakens.

3. Mid‑2026 settlement‑talks. Historically, settlement news acts as a “catalyst” that either removes the upside‑risk (if a cash‑payment is announced) or triggers a final rally (if the company negotiates a favorable cap). At the start of the settlement window, tighten risk limits (reduce position to ≤ 10 % of capital) and hold a protective stop about 12 % below the current market price. If a settlement is disclosed and the terms look modest, consider taking partial profits or converting the exposure to a defensive put‑spread to hedge residual tail risk until the final resolution.

Overall, the class‑action timeline dictates a tiered position‑sizing approach: light‑to‑moderate at the filing stage, a controlled increase as discovery proceeds—with built‑in stops and trailing stops—followed by a de‑risking phase as settlement talks loom. This structure aligns capital exposure with the escalating probability of material news flow while preserving upside if the lawsuit’s merits weaken the company’s liability.