On stage in August, Henrik Fisker triumphantly unveiled two prototypes to launch his EV firm into the mainstream. The Alaska, Fisker’s pickup vehicle, and the Pear, a mass-market EV, were available.
In the weeks that followed, Fisker allegedly stopped paying the engineering company that contributed to the creation of the autos, according to a previously unreported federal complaint. Bertrandt AG’s U.S. subsidiary claims Fisker is unjustly holding onto car IP. Damages are estimated at $13 million.
The case piles on legal woes for Fisker, which is near bankruptcy. Of the 30 lemon law claims filed, Fisker has settled a few. A former director launched a class action lawsuit for unpaid compensation. A textile supplier has sued Fisker for nearly $1 million in unpaid bills.
The engineering complaint stands out in the legal turmoil because it reveals Fisker was already struggling financially last August, despite its CEO’s strong assertions.
Fisker’s VP of communications, Matthew DeBord, informed Eltrys via email that Bertrandt’s case lacks merit. It is a legally unjustified and regrettable effort by a valued partner to extract funds and intellectual property from Fisker that Bertrandt has no right to under applicable agreements or otherwise.” He wouldn’t discuss other situations.
According to a copy of the design and development agreement attached to the lawsuit, Bertrandt entered into a “design and development agreement” with Fisker in May 2022 to perform “engineering, design, and development services” on the Pear with a value of over $35 million. (The agreement also states that Fisker contracted Bertrandt for a Pear EV feasibility study, cost analysis, scheduling proposal, and other tasks.)
Bertrandt claims Fisker wanted it to undertake comparable changes on the Alaska pickup vehicle after signing the arrangement. Bertrandt claims in the case that Fisker never signed a written agreement for Alaska, but it quoted $1.66 million, which Fisker agreed to pay.
The lawsuit claims Fisker ceased paying Bertrandt in August 2023. Fisker failed to pay the company bills, totaling $7,061,443, until January 31, 2024. The engineering company also argues that Fisker’s “pause” on Pear and Alaska EV development created delay charges for Bertrandt, breaching the contract.
On February 6, 2024, Bertrandt met with Fisker, who “acknowledged its liability for payment of these invoices and agreed to promptly pay $3,685,000 as a partial payment” but never did.
Bertrandt claims that breaching the contract has cost the engineering business $5,858,000 in “lost profits, delay costs, and incidental damages,” resulting in a demand of $12,919,443.
Additionally, the business ordered on April 22 that Fisker “return all of Bertrandt’s intellectual property” and “certify in writing that Fisker had not retained any hard copies or electronic copies,” but the EV startup “failed to do either.”
The lawsuit claims that Fisker has unfairly benefited at Bertrandt’s expense.
Other suppliers, besides Bertrandt, have sued Fisker.
In early April, Georgia-based Corinthian Textiles sued Fisker in LA Superior Court. The supplier says it agreed to provide the EV company with “customized products for use in Fisker’s automobiles” in early 2023. According to the company’s website, its automotive business makes floor, trunk, and cargo mats, as well as “automotive carpet.” It doesn’t indicate what it manufactured for Fisker.
Corinthian claims Fisker “refused and continues to refuse” $1,077,571.75 in bills and fees.
Doing overtime
Robert Lee, a Fisker employee from October 2023 to March 5, 2024, filed a proposed class action case in Los Angeles Superior Court days before Bertrandt sued in federal court, citing overwork and underpayment. The complaint also alleges that Fisker failed to repay expenditures and pay salaries to departing workers.
Lee says he and other hourly workers worked “well over” eight hours a day and 40 hours per week, frequently exceeding 12. Fisker “frequently compelled” them to work on weekends, they claimed. According to the lawsuit, Fisker did not pay workers during that period. Lee argues Fisker mistracked hours and withheld commissions from hourly pay.
He says staff were “regularly compelled to work off the clock, and [Fisker Inc.] created a policy to account for fewer hours than the total number of hours actually worked” to “meet certain goals and generate more sales.”
Lee says Fisker “effectively coerced and pressured its non-exempt employees to work around the clock, have their wages deducted, have their wages miscalculated, to shorten (tantamount to a missed meal period), or forego meal and rest periods (or not be paid for their rest breaks).
As reported by Eltrys, Fisker faced litigation in California claiming violations of the state’s lemon law as early as November. The business has begun settling some of those claims by purchasing back the automobiles, according to court papers and a source.
The state has seen an increase in lemon law claims, receiving the majority of Fisker’s US automobile deliveries.
In New York, Florida, and Massachusetts, Fisker customers may have taken action. Certain areas require arbitration for lemon law claims, which complicates the number of proceedings the corporation might encounter.
Fisker said in its 2023 annual report that the company is still fighting against a shareholder class action lawsuit claiming securities law breaches. Fisker then vaguely states that “various other legal actions, claims, and proceedings are pending against the Company, including, but not limited to, matters arising out of alleged product defects; employment-related matters; product warranties; and consumer protection laws.”
It hinted that unidentified government entities had requested business information from it, including subpoenas, in a new piece of language that was not present in any of its prior SEC filings.
“The Company also receives subpoenas and other inquiries or requests for information from agencies or other representatives of U.S. federal, state, and foreign governments,” it added. Communications VP DeBord told Eltrys that Fisker “currently [has] no pending subpoenas from governments.”
