Item 1. Legal Proceedings
Item 1.
Legal Proceedings.
From time to time, we may become involved in legal proceedings relating to claims arising from the ordinary course of business. Future litigation may be necessary to defend ourselves. The results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.
In May 2022, a securities class action complaint captioned Leacock v. IonQ, Inc. et al. , Case No. 8:22-cv-01306, was filed by a stockholder of the Company in the United States District Court for the District of Maryland (the “Leacock Litigation”) against the Company and certain of the Company’s current officers. In June 2022, a securities class action complaint captioned Fisher v. IonQ, Inc. , Case No. 8:22-cv-01306-DLB (the “Fisher Litigation”) was filed by a stockholder of the Company and certain of the Company’s current officers (“IonQ Defendants”). Both the Leacock Litigation and Fisher Litigation, which have been consolidated into a single action, allege violations of Section 10(b) of the Exchange Act, and Rule 10b-5 promulgated thereunder, and Section 20(a) of the Exchange Act and seek damages. In September 2022, the Court appointed lead plaintiffs and counsel for lead plaintiffs, and ordered lead plaintiffs to file a consolidated amended complaint. The consolidated amended complaint was filed on November 22, 2022. As part of the consolidated amended complaint, certain members of the Company’s Board of Directors as well as other dMY-related defendants (the “Additional Defendants”) have been added as defendants to the case. On February 7, 2023, the IonQ Defendants and the Additional Defendants each filed a motion to dismiss the consolidated amended complaint. Both the IonQ Defendants and the Additional Defendants believe that the allegations in the various complaints are without merit and intend to defend the matters vigorously.
On March 2, 2023, we filed a petition in the Delaware Court of Chancery pursuant to Section 205 of the Delaware General Corporation Law, which permits the Court of Chancery, in its discretion, to validate potentially defective corporate acts. The petition sought an order of the Chancery Court validating and declaring effective (i) our Second Amended and Restated Certificate of Incorporation dated September 30, 2021 (the “A&R COI”), including its filing and effectiveness, as of the date and time that it was originally filed with the Delaware Secretary of State and (ii) all shares of our capital stock issued in reliance on the validity and effectiveness of the A&R COI as of the date and time of the original issuance of such shares. Although we believe the A&R COI and all shares issued under it were valid and effective at all relevant times, a recent decision of the Court of Chancery created uncertainty regarding the approval of the A&R COI by our stockholders in February 2021. On March 17, 2023, the Court of Chancery entered the requested order. In addition, at no point prior to March 17, 2023 had we issued or reserved for issuance shares in excess of the predecessor certificate of incorporation of the Company.
Please refer to Note 8, Commitments and Contingencies, to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for further details on current legal proceedings.
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