The complaint alleges that Pentwater Capital and its founder, Matthew Halbower, used SEC filings to disclose the size of their growing Avis position while failing to reveal the underlying intent to squeeze the stock. According to the filing, this lack of transparency left investors vulnerable when 4.3 million shares were offloaded in late April 2026, triggering a 74.51% collapse in share value from an April 21 peak of $713.97 to $182.005 by April 28.
Investors Target Pentwater Capital Over Alleged Avis Stock Manipulation
A securities class action lawsuit filed in the U.S. District Court for the Middle District of Florida accuses Pentwater Capital Management LP of obscuring a market-manipulating short-squeeze strategy. The litigation centers on the firm’s accumulation and sudden offloading of Avis Budget Group shares between February 2025 and April 2026.
Plaintiffs contend that the firm masked its true 51% economic interest through cash-settled swaps and ignored Section 16 insider trading restrictions. While Pentwater reported its share counts, the suit claims these disclosures were misleading because they omitted the objective of unwinding the position at the height of the squeeze. Following the market drop, Avis reached a $650 million settlement to resolve its own Section 16(b) short-swing profit claims. Investors who purchased CAR securities during the class period must apply to serve as lead plaintiff by September 29, 2026.
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