Datavault AI (NASDAQ: DVLT) has taken legal action by filing a federal lawsuit in the Northern District of Illinois, accusing unknown defendants of securities fraud, defamation, and intentional tort related to 'naked' short selling and the spread of false information online. The lawsuit, represented by Dickinson Wright, targets individuals and entities identified as Does 1-50, Roe Corporations 1-50, and XYZ LLCs 1-50, alleging they employed manipulative trading strategies such as spoofing, layering, and marking the close, alongside disseminating defamatory statements on platforms like Stocktwits and LinkedIn.
The legal complaint seeks damages and explores the possibility of civil RICO claims, aiming to hold the defendants accountable for actions that have negatively impacted Datavault AI's stock performance. Despite the company's positive disclosures, press releases, and strategic partnerships in 2025, these alleged manipulative practices have undermined investor confidence and stock value. Jacob Frenkel, Chair of Dickinson Wright’s Securities Enforcement Practice, emphasized the lawsuit's goal to address and rectify the harm caused by these activities.
This case underscores the broader issue of market manipulation and the spread of misinformation in the digital age, posing significant challenges for companies striving to maintain their reputation and stock integrity. The outcome of this lawsuit could set a precedent for how similar cases are handled in the future, potentially influencing regulatory approaches to market manipulation and online defamation.
