Lunai Bioworks Files Amended Naked Short Selling Suit, Alleges 81% Failures to Deliver
LNAI sits 83% above its 52-week low of $1.21 on elevated volume (6.8× avg).
Summary
Lunai Bioworks filed an amended complaint in Delaware federal court naming 10 defendants, including three FINRA broker-dealers, in an alleged naked short selling scheme. The suit claims failures to deliver on over 81% of outstanding shares, totaling 29.6 million shares, with a single-day trading volume of 15.3 times shares outstanding on March 17, 2026, when zero shares were available to borrow and the borrow rate hit 621%. The company seeks treble damages under RICO and plans to add more defendants as discovery proceeds. This follows a series of Nasdaq compliance struggles and a recent reverse split; the lawsuit introduces a new legal front that could distract management and drain resources, though potential damages could be material relative to the company's $10.8M market cap. The allegations, if proven, may also attract regulatory scrutiny and impact trading dynamics.
At the time of this announcement, LNAI was trading at $2.22 on NASDAQ in the Life Sciences sector, with a market capitalization of approximately $10.8M. The 52-week trading range was $1.21 to $21.60. This news item was assessed with negative market sentiment and an importance score of 8 out of 10. Source: PR Newswire.