Lunai Bioworks Litigation Updates

Update – August 3, 2026

This page was originally published in May 2026 following the filing of Lunai Bioworks, Inc. v. Does 1-50, Roe Corporations 1-50, and XYZ LLCs 1-50. Since that time, the case has advanced significantly.

On August 3, 2026, Dickinson Wright, with Securities Enforcement and Government Investigations Practice Chair Jacob Frenkel serving as lead counsel, together with Delaware co-counsel, filed a First Amended Complaint in the United States District Court for the District of Delaware. The amended pleading expands the lawsuit and, according to the Complaint, presents one of the most detailed allegations of coordinated naked short selling and related market manipulation brought in federal court.

The First Amended Complaint alleges a coordinated scheme involving naked short selling, failures to deliver in violation of the federal securities laws, market manipulation, securities fraud, and related misconduct that allegedly distorted the market for Lunai’s stock and harmed both the company and its shareholders. The action now asserts claims under Sections 9(a) and 10(b) of the Securities Exchange Act of 1934, Rule 10b-5, civil RICO, common law fraud, and tortious interference.

Among its most significant allegations, the First Amended Complaint identifies 10 accounts by name that allegedly engaged in naked short selling activity—an allegation the Complaint asserts is unprecedented in this type of litigation. It also details alleged trading volumes that exceeded the company’s available share supply, substantial failures to deliver, alleged efforts to evade Regulation SHO requirements, and trading activity that allegedly neutralized the market impact of positive corporate developments.

The lawsuit raises significant issues concerning market transparency, settlement integrity, market manipulation, and the protections afforded to public companies and investors under the federal securities laws. If proven, the allegations would also implicate issues that have long been of interest to securities regulators, criminal enforcement authorities, and the financial media.

A copy of the First Amended Complaint, filed on August 3, 2026, is available here.

Background

On May 12, 2026, Dickinson Wright and Fox Rothschild filed suit on behalf of Lunai Bioworks, Inc. (Nasdaq: LNAI), alleging that unidentified defendants engaged in a coordinated naked short-selling scheme designed to manipulate the market for Lunai’s common stock. The original Complaint alleged that the defendants engaged in deceptive trading practices that violated federal securities laws and regulations, including Regulation SHO, resulting in extraordinary failures to deliver and trading volumes far exceeding the company’s publicly available share supply.

The original Complaint asserted that these practices artificially depressed Lunai’s stock price despite a series of positive corporate developments, including advancements in the company’s AI-driven precision medicine platform, cancer immunotherapy research, and strategic business initiatives. The lawsuit sought compensatory and special damages, injunctive relief, and other remedies available under federal law.

With the filing of the First Amended Complaint, the litigation has evolved substantially. In addition to expanding the factual allegations, the amended pleading adds new causes of action, including civil RICO, identifies specific accounts allegedly involved in the trading activity, and provides additional detail regarding the alleged market manipulation and its impact on Lunai and its shareholders.

Dickinson Wright will continue to update this page as significant developments occur. For the most current filings and case information, please consult the federal court’s PACER system.

Source: Lunai Bioworks, Inc. v. Seven Points Capital, LLC, et al., First Amended Complaint, U.S. District Court for the District of Delaware, filed August 3, 2026.