August 5, 2026  ·  Complaint filed August 3, 2026  ·  mad, No. 1:26-cv-13539

Newman News, By David Brunk

Read the filing

Huston v. Hu Alleges SES AI Misrepresented Business Prospects Before Stock Plunge

SES AI Promoted AISPEX MOU as Key Revenue Opportunity

On January 29, 2025, SES AI Corporation issued a press release announcing a memorandum of understanding with Texas-based energy provider AISPEX targeting up to $45 million for battery energy storage systems (BESS) solutions. The deal included a first deployment at a crypto mining site in Texas valued at up to $13 million for 30 MWh of capacity, with a targeted total capacity of 100 MWh under the MOU, according to allegations in the verified shareholder derivative complaint filed August 3, 2026. The complaint states that SES AI promoted the AISPEX MOU as a major 2025 revenue opportunity after losing its partnership with General Motors (Compl. ¶33, 52).

During SES AI’s Q4 2024 earnings call on February 25, 2025, CEO Qichao Hu stated, “SES AI is planning to expand into a new and growing field, Battery Energy Storage Systems, BESS,” and “we announced that SES AI signed an MOU with AISPEX targeting up to $45 million to provide up to 100-megawatt hours of advanced Battery Energy Storage Systems.” Hu further emphasized the significance of the deal, noting the first deployment at a crypto mining site in Texas (Compl. ¶34). The complaint alleges these representations were materially misleading, as AISPEX’s headquarters was later found to be a “shabby building with a different company’s sign,” and the MOU was never fulfilled (Compl. ¶47).

Joint Venture with Hisun Announced Amid Questions Over U.S. Operations

On October 14, 2025, SES AI issued a press release announcing a term sheet for a joint venture with Hisun New Energy Materials Ltd. Co. ("Hisun"), claiming a 90% ownership stake and touting Hisun’s 150,000-ton annual global electrolyte capacity (Compl. ¶37). The venture was promoted as a recurring revenue source and a “capex-light approach” to scaling SES AI’s electrolyte materials, with CEO Hu stating, “We have already demonstrated how quickly Molecular Universe can accelerate material discovery for battery makers.” The press release described the joint venture as a strategic move to supply electrolyte materials discovered by SES AI’s Molecular Universe platform for applications in electric vehicles, drones, robotics, eVTOL (electric vertical takeoff and landing), and energy storage systems (Compl. ¶37-38).

Corporate filings described Hisun’s planned Texas facility as covering an area of 30 acres, with a designed construction area of about 200,000 square feet, and “expected to start construction in May 2024 and start production in July 2025” (Compl. ¶57). However, the complaint contends the site remained an “undeveloped swamp” with no permits or improvements. Hisun’s U.S. subsidiary, registered in Delaware, listed its corporate address at a residential home in Texas, where the only recorded asset was a 2023 Ford Mustang Mach-E Premium. Wolfpack Research later reported Hisun had only one U.S. employee, raising further questions about the joint venture’s viability (Compl. ¶59-60).

Molecular Universe Platform Faced Allegations of Circular Revenue and Practical Obstacles

SES AI promoted its AI-driven material discovery platform, Molecular Universe, as a breakthrough technology with applications across multiple high-growth sectors. During the Q4 2024 earnings call, CEO Hu stated, “This was a game changer as these AI-enhanced 2170 cells are the first batteries to use an electrolyte discovered by SES AI’s Molecular Universe effort” (Compl. ¶35). The platform was positioned as a key differentiator in SES AI’s expansion into the multi-hundred GWh energy storage systems (ESS) market, which the company claimed was valued at $300 billion globally (Compl. ¶36). The UZ Energy acquisition, announced on September 18, 2025, was framed as adding ESS hardware and positioning SES AI as an active player in this market (Compl. ¶36).

The complaint alleges, however, that the platform was used to create the appearance of revenue through circular transactions. A former employee is quoted stating, “In exchange for buying a bunch of equipment from a company, that company would turn around and purchase a license to Molecular Universe,” while another added, “I’m not aware of anybody that’s paying for [Molecular Universe]” (Compl. ¶64-65). The platform was also described by a former employee as a “toy” facing “synthesis bottlenecks,” which called into question its commercial viability (Compl. ¶63).

The complaint cites a report from Wolfpack Research, issued on December 9, 2025, that alleged SES AI “announced phantom deals and promoted an AI product... to distract from its impending loss of two [OEM partners]” (Compl. ¶45, 62). The report further challenged the legitimacy of SES AI’s promoted transactions and the demand for Molecular Universe, stating, “We are short [SES] because they have announced phantom deals and promoted an AI product... to distract from its impending loss of two” (Compl. ¶45).

UZ Energy Acquisition Positioned as Strategic Expansion into $300 Billion ESS Market

On September 18, 2025, SES AI announced the closing of its acquisition of Shenzhen UZ Energy Co., Ltd. ("UZ Energy") for $25.5 million, positioning the deal as a strategic move to expand into the $300 billion global energy storage systems (ESS) market. The acquisition was framed as adding ESS hardware, North America expansion potential, and a customer base in Australia, Europe, and Asia (Compl. ¶36). The complaint alleges, however, that the acquisition’s registered agent, Chianglian "Michael" Cung, was tied to a $1 billion Ponzi scheme involving entities registered in the British Virgin Islands and Hong Kong (Compl. ¶46).

The complaint further contends that the acquisition was part of a broader pattern of misrepresentation, as SES AI’s risk disclosures noted its reliance on third-party manufacturers outside the U.S. for ESS components, which may have contributed to the logistics constraints that later delayed $1.5 million in fourth-quarter 2025 revenue (Compl. ¶40). The complaint states that SES AI’s revenue for the first three quarters of 2025 was $16.4 million, and the company had guided full-year 2025 revenue of $20–$25 million, ultimately reporting $21 million (Compl. ¶41).

Executive Compensation and Insider Sales Followed Disclosures

Between November 2025 and January 2026, SES AI’s Chief Science Officer, Dr. Hong Gan, sold a total of 500,000 shares of SES AI stock for combined proceeds of $1,087,500. The sales included 250,000 shares sold on November 17, 2025, for $497,500, and another 250,000 shares sold on January 22, 2026, for $590,000 (Compl. ¶43). These transactions occurred amid a period of heightened scrutiny following the December 9, 2025, Wolfpack Research report and the company’s subsequent disclosures about revenue delays and weak guidance.

The complaint also details compensation received by the Individual Defendants in 2024. CEO Qichao Hu received total compensation of $4,099,946, while Directors Eric Luo, Jiong Ma, Jang Wook Choi, and Michael Noonen received $248,983, $263,983, $213,983, and $231,483, respectively (Compl. ¶6-10). The complaint alleges these compensation packages were tied to the Individual Defendants’ roles in promoting SES AI’s allegedly misleading business prospects and financial disclosures. Hu stated during the Q4 2024 earnings call, “So, our goal at SES AI is to accelerate energy transition through AI...” (Compl. ¶41).

The complaint alleges SES AI repurchased 871,754 shares at an average price of $1.27 per share in July 2025, totaling $1,107,127.58. The plaintiff contends this repurchase was an overpayment, as the stock price later declined significantly (Compl. ¶72, 97).

Revenue Guidance Cut Triggered 36.8% Stock Decline

On March 4, 2026, SES AI disclosed that $1.5 million in fourth-quarter 2025 revenue would be delayed to the first quarter of 2026 due to “logistics constraints.” The company also issued 2026 revenue guidance of $30–$35 million, well below Wall Street’s expectation of $51.67 million. SES AI had previously guided full-year 2025 revenue of $20 million to $25 million but ultimately reported $21 million, falling short of even its own projections (Compl. ¶41). For the first three quarters of 2025, SES AI reported $16.4 million in revenue, and the March 2026 disclosure revealed underlying weaknesses in its revenue pipeline.

The next day, SES AI’s stock price fell approximately 36.8%, dropping $0.63 to close at $1.08 (Compl. ¶71). The complaint alleges the weak guidance exposed the falsity of SES AI’s earlier representations about its business prospects, including statements made by CEO Hu during the 28th Annual Needham Growth Conference on January 16, 2026.

The complaint contends the Individual Defendants knew or should have known their public statements were false or misleading, citing their access to adverse non-public information and control over SES AI’s disclosures. The Audit Committee, including Directors Eric Luo, Jiong Ma, and Andrew Boyd, is accused of failing to oversee the alleged scheme, with the complaint stating they “conducted little, if any, oversight of the Company’s engagement in the Individual Defendants’ scheme” (Compl. ¶90).

Director Resignations and Board Composition Changes

The complaint details changes in SES AI’s Board of Directors during the relevant period, including the resignations of Jang Wook Choi on November 10, 2025, and Michael Noonen on September 2, 2025 (Compl. ¶1). Andrew Boyd joined the Board and Audit Committee in September 2025, while Eric Luo and Jiong Ma had joined the Board in February 2022 (Compl. ¶1). The complaint alleges that the Director Defendants, including Luo, Ma, and Boyd, failed in their Audit Committee duties by allowing false and misleading statements to be disseminated (Compl. ¶89).

Derivative Claims Assert Breaches of Fiduciary Duty, Corporate Waste, and Securities Violations

The verified shareholder derivative complaint, filed on August 3, 2026, asserts five counts against the Individual Defendants: Qichao Hu, Andrew Boyd, Eric Luo, Jiong Ma, Jang Wook Choi, and Michael Noonen. The claims include:

• COUNT ONE: Violations of Section 10(b) of the Securities Exchange Act of 1934 (15 U.S.C. § 78j(b)) and SEC Rule 10b-5 (17 C.F.R. § 240.10b-5) – against the Individual Defendants. The complaint alleges the Individual Defendants made materially false and misleading statements about SES AI’s business prospects, revenue pipeline, and technological capabilities (Compl. ¶1, 110).
• COUNT TWO: Breach of Fiduciary Duties – against the Individual Defendants. The complaint alleges the defendants breached their duties of trust, loyalty, good faith, and due care by failing to ensure accurate financial reporting, prudent supervision, and compliance with legal obligations (Compl. ¶2, 22-25). The complaint states, “the Director Defendants conducted little, if any, oversight of the Company’s engagement in the Individual Defendants’ scheme” (Compl. ¶90).
• COUNT THREE: Unjust Enrichment – against the Individual Defendants. The complaint seeks disgorgement of ill-gotten gains, including bonuses and compensation tied to the alleged wrongdoing (Compl. ¶3, 118).
• COUNT FOUR: Waste of Corporate Assets – against the Individual Defendants. The complaint alleges the defendants wasted corporate assets through excessive compensation and inflated stock repurchases (Compl. ¶4, 123).
• COUNT FIVE: Gross Mismanagement – against the Individual Defendants. The complaint alleges the defendants engaged in gross mismanagement by allowing false and misleading statements, failing to oversee financial disclosures, and disregarding red flags related to SES AI’s business prospects (Compl. ¶5, 85).

The complaint alleges that the Individual Defendants, as top executives and directors, controlled the content of SES AI’s public statements and had access to adverse non-public information, including the true status of the AISPEX MOU, Hisun joint venture, and Molecular Universe platform (Compl. ¶100). It further contends that the defendants’ conduct involved a “knowing and culpable violation of their obligations as directors and officers” (Compl. ¶26). The complaint seeks damages, corporate governance reforms, and disgorgement of ill-gotten gains, while excusing demand on the Board as futile due to the directors’ alleged complicity. The complaint notes that CEO Qichao Hu “faces significant personal liability, in the Securities Class Action based on substantially the same wrongdoing as alleged herein” (Compl. ¶88).

The allegations described here are taken from the filing and remain unproven; no responsive pleading is reflected in the source document.

David Brunk is a civil litigation attorney. He can be reached at david@newmanbrunk.com.