Mullen Automotive Stock News: MULN soars over 36% to close out Tuesday

• Mullen Automotive stock is still reeling from October 19 announcement that it seeks to perform a reverse stock split in December.
• Mullen updates lawsuit against TD Ameritrade, Charles Schwab and National Finance Services.
• New York Judge says Mullen needs to file an amended complaint by November 30.
• Mullen will seek to give investors one share for between two and 100 shares of current MULN holdings.
• NASDAQ delisting saga has still not been decided as CEO Michery hopes to resolve issue by pushing MULN above $1 per share.

Mullen Automotive (MULN), the electric vehicle (EV) penny stock, held onto its recovery on Tuesday. MULN stock closed out the session up 36.7% at $0.306 per share, a little below its daily high of $0.328.

Following a mid-session lull, the Dow Jones, NASDAQ Composite and S&P 500 indices ended up closing near their intraday highs as well but all below 1%. The broad market has made gains ahead of many large-cap stocks posting earnings results after the close. These include Microsoft (MSFT) and Alphabet (GOOGL) and are likely to sway indices in the post-market.

The beloved underdog of retail investors, Mullen has been seeking to resolve issues with stock brokers it blames for manipulating its stock price, and a New York judge issued a ruling on Monday saying the company must update its complaint by the end of the month.

Mullen stock news: Judge Analisa Torres is back in the news

The United States District Court of the Southern District of New York has advised Mullen’s legal delegation that it needs to update its complaint by November 30. Mullen is suing TD Ameritrade, Charles Schwab, National Finance Services and others with the intent of exposing these brokers for manipulating the MULN stock price via allowing naked shorting and other illegal activities. 

Judge Analisa Torres, who is well known for providing Ripple (XRP) with a partial victory in its case against the Securities & Exchange Commission (SEC), is presiding over Mullen’s lawsuit and has ordered both parties to jointly file their case management plan by December 15.

“We are aggressively pursuing all remedies available to us to protect the company and our shareholders,” said David Michery, CEO and chairman of Mullen Automotive, in a statement on Monday.

Mullen has retained the Warshaw Burstein and the Christian Attar law firms to represent it. In Mullen’s statement, Warshaw attorney Alan Pollack commented, “This case raises certain unique legal issues concerning how broker-dealers manipulate the marketplace and how such manipulation impacts retail investors. Counsel will diligently work to expose defendants’ wrongdoing in order to protect the rights of Mullen and its shareholders.”

Third reverse stock split of the year startles investors

Mullen’s stock price dove more than 22% last Thursday, October 19, after the company announced it will seek a third reverse stock split in December. This action may be necessary in order to raise the MULN share price above $1.

The $1 share price is required by NASDAQ to remain listed. Back in September, Mullen received notice that their stock was in danger of being delisted. Mullen executives appealed the decision, and a NASDAQ committee is still in talks about whether to permit Mullen more time to achieve the $1 threshold. 

Last Thursday, Mullen announced it will hold a special shareholder meeting on December 15 to effect a reverse split between 1-for-2 to 1-for-100. This news follows reverse splits in May and August of this year that were unable to keep the stock price above $1. Shareholders have already had their nominal number of owned shares cut to one MULN share for every 225 they previously owned at the beginning of 2023. December’s reverse split will attempt to push this number up to over 1-for-1,000 shares for the full year.