According to the Complaint, Origin is a sustainable materials company founded in 2008 by chemical engineering students at the University of California, Davis.  The Company purports to have developed a platform to convert the carbon found in biomass into carbon negative materials that can replace the petroleum-based substances typically used in various end products.  One of the sustainable materials in Origin’s platform is chloromethylfurfural (“CMF”), a building block chemical that can be converted into, among other products, (1) paraxylene (“PX”), a product that can replace non-sustainable chemicals in existing supply chains to produce polyethylene terephthalate (“PET”); and (2) furandicarboxylic acid (“FDCA”), which can be converted into polyethylene furanoate (“PEF”).  According to the Company, these chemicals can be used in a variety of applications. PET’s applications include packaging, textiles, car parts, carpeting, toys, and construction materials, while FDCA and PEF’s include surfactants, epoxy resins, and packaging, with PEF having the potential to compete with glass and aluminum.

Plaintiff alleges that Defendants made materially false and misleading statements throughout the Class Period.  Among other things, Defendants failed to disclose to investors that: (1) Origin would not be able to meet its previously announced timeline for the construction of the Origin 2 plant; (2) demand for PX had dropped such that it would not be the production focus of Origin 2; (3) Origin could not construct Origin 2 at its previously disclosed cost; and (4) Origin could not construct Origin 2 at the scale it had previously identified.

On August 9, 2023, after the market closed, Origin announced that it was significantly delaying the timeline for construction on its Origin 2 commercial plant and changing the product slate at Origin 2 from a focus on PX to a focus on FDCA.  The Company disclosed that it “now expects Origin 2 to be completed in two phases, with Phase 1 estimated to be completed in late 2026 to 2027, and Phase 2 estimated to be completed in 2028, compared with our initial expectation for a mid-2025 completion.”  Origin blamed the delay on the “high-cost environment” for capital projects.  The Company further revealed that the construction would cost more and yield less capacity than previously announced.

On this news, Origin’s stock price fell $2.88 per share, or 66.5%, to close at $1.45 per share on August 10, 2023.

If you wish to serve as lead plaintiff, you must move the Court no later than October 24, 2023. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. Your ability to share in any recovery doesn’t require that you serve as lead plaintiff. If you choose to take no action, you may remain an absent class member.

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