Datavault AI (NASDAQ: DVLT) filed a federal lawsuit alleging securities fraud, defamation, and intentional tort tied to naked short selling and online misinformation. The complaint, filed in the Northern District of Illinois by Dickinson Wright, names unknown defendants—Does 1-50, Roe Corporations 1-50, and XYZ LLCs 1-50—and claims the short sellers used manipulative tactics including spoofing, layering, and marking the close while spreading defamatory falsehoods on Stocktwits and LinkedIn.
The lawsuit seeks damages and potential civil RICO claims, representing a significant legal challenge against alleged market manipulation practices that have become increasingly common in volatile technology stocks. Lead counsel Jacob Frenkel, Chair of Dickinson Wright's Securities Enforcement Practice, stated the action is aimed at holding accountable those responsible for conduct that has undermined Datavault AI's stock despite a string of positive disclosures, press releases, and strategic partnerships in 2025.
This legal action comes at a critical time for companies operating in the Web 3.0 and AI sectors, where rapid technological advancement often creates market volatility that can be exploited by bad actors. The case highlights the growing tension between legitimate short selling and manipulative practices that cross into securities fraud territory. The inclusion of civil RICO claims suggests the company believes there may be an organized effort behind the alleged manipulation.
Datavault AI's position as a company leading in AI experience, valuation, and monetization of assets in the Web 3.0 environment makes this case particularly significant for the broader technology investment community. The company's cloud-based platform provides comprehensive solutions with a collaborative focus in its Acoustic Science and Data Science Divisions, serving multiple industries including sports & entertainment, biotech, education, fintech, real estate, healthcare, and energy.
The lawsuit's focus on online misinformation spread through platforms like Stocktwits and LinkedIn underscores the modern challenges companies face in maintaining market integrity in the digital age. As more investors turn to social media for investment information, the potential for coordinated misinformation campaigns to impact stock prices has increased substantially. The full details of the complaint are available at https://ibn.fm/rbueY, providing investors and legal observers with comprehensive information about the allegations.
This legal action represents a proactive stance by a public company against what it perceives as systematic market manipulation, potentially setting important precedents for how courts handle similar cases involving digital misinformation and sophisticated trading tactics. The outcome could influence how regulators approach market manipulation in an increasingly digital and decentralized financial landscape.
