A shareholder has filed a lawsuit against electric vehicle company Fly-E Group, the company's board, and executive officers, accusing them of misleading investors about the safety and financial prospects of their products.
The complaint filed by plaintiff Martin Flynn accuses the defendants of breaches of fiduciary duties and violations of federal securities laws. The lawsuit describes corporate governance concerns at Fly-E Group, Inc., a company known for its smart electric motorcycles and scooters. According to Flynn’s allegations, between July 15 and August 14, 2025, board members and executives made materially false statements regarding the company’s financial health and product safety. These statements allegedly misled investors about Fly-E’s performance and growth potential. Flynn asserts that the executives failed to disclose critical issues related to lithium battery safety that led to several accidents involving their e-bikes and e-scooters.
Flynn claims these omissions directly affected sales revenue and investor confidence. Despite optimistic forecasts about becoming a leader in urban mobility, Fly-E’s sales reportedly declined as incidents involving its lithium batteries increased. On August 14, 2025, the company announced it would not file its quarterly report on time due to a 32% drop in net revenues, primarily attributed to decreased unit sales following the battery incidents.
Following the disclosure, Fly-E’s stock price fell by approximately 87%, from $7.76 per share on August 14 to $1.00 per share on August 15, causing significant financial losses to shareholders. The plaintiff seeks accountability from the board for failing to implement adequate internal controls or corrective measures to prevent the alleged misrepresentations.
Flynn is pursuing damages for losses incurred by the company and equitable relief aimed at improving corporate governance. He also seeks restitution from the defendants and disgorgement of any profits obtained through the alleged misconduct.
The plaintiff is represented by attorneys Shane T. Rowley and Danielle Rowland Lindahl of Rowley Law PLLC. The case was filed in the United States District Court for the Eastern District of New York under Case ID 1:25-cv-06036.