Rivian Automotive (RIVN) is headed to court to face allegations from Tesla that it encouraged former Tesla employees to steal trade secrets. According to Reuters, Judge Theodore C. Zayner of the Santa Clara County Superior Court has tentatively denied Rivian’s request to dismiss the lawsuit. The judge stated, “Tesla’s evidence establishes that some Rivian employees were less thoroughly investigated and not disciplined,” pointing to concerns over Rivian’s handling of the situation.
Details of the Lawsuit
The legal battle began in 2020 when Tesla (TSLA) accused Rivian of a pattern of poaching employees and misappropriating confidential information. Rivian has denied these allegations, asserting that their investigations into the claims were thorough. However, the judge found these efforts insufficient to dismiss the case.
Next Steps in the Legal Process
A final hearing to finalize the decision is scheduled for Wednesday. While Rivian has declined to comment further, Tesla has not yet responded to Reuters for additional information. As this case progresses, it will be crucial to follow how the court addresses these high-stakes claims.
Is Rivian a Good Buy?
Analysts remain cautiously optimistic about RIVN stock, with a Moderate Buy consensus rating based on 12 Buys, eight Holds, and two Sells. Over the past year, RIVN has declined by more than 25%, and the average RIVN price target of $75.13 implies a downside potential of 31.37% from current levels.
