The lawsuit, filed in the United States District Court for the Middle District of Florida, claims Pentwater Capital Management LP amassed a 51% economic interest in Avis Budget Group (NASDAQ: CAR) through common stock and cash-settled swaps. According to the complaint, this aggressive accumulation triggered a short squeeze, driving the stock price from under $200 to an intraday high of $765.94 despite underwhelming business fundamentals.
Legal counsel Joseph E. Levi alleges that after the peak, 4.3 million shares were liquidated across two trading sessions in April 2026, generating $1.75 billion in proceeds. This sell-off caused the share price to plummet by approximately 74.51%. The litigation asserts violations under the Securities Exchange Act of 1934, specifically targeting the alleged manipulation of market prices through a series of tactical trades designed to induce purchases from other market participants.
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