Apple Car exec facing SEC lawsuit over previous job at EV startup

One of the top executives working on Apple’s Project Titan self-driving car team is being sued by the SEC. Bloomberg reports that SEC is suing Ulrich Kranz “for allegedly breaking securities rules” during his time as CEO at the electric car startup Canoo.

Kranz joined Apple back in June of 2021 to work on the team developing Apple Car and the associated self-driving car technologies. Kranz spent 30 years at BMW, serving as the senior vice president of the team that developed the BMW i3 and i8 electric and hybrid cars.

When he departed BMW he 2016, Kranz spent three months at the EV startup Faraday Future before confounding and serving as CEO of Canoo. At Canoo, he pushed the company to go public through a merger with an SPAC, or special purpose acquisition company. Kranz left Canoo in April of 2021 and joined Apple just weeks later.

The new lawsuit accuses Kraz and Canoo’s former CFO, Paul Balciunas, of “providing unreasonable revenue projections.” Kranz is also being accused of “misstating how much he was paid.” Through the lawsuit, the SEC hopes to prevent both Kranz and Balciunas from “serving as officers at public companies” and charge them both a fine. Canoo itself paid a $1.5 million fine when it settled an SEC investigation earlier this year focused on its SPAC merger.

The lawsuit comes after the SEC opened an investigation in 2021 into the company’s “operations, business model, revenues, revenue strategy, customer agreements, earnings, and other related topics, along with the recent departures of certain of the company’s officers.”

As our colleagues at Electrek reported in March:

After going public in 2020, along with a slew of other electric vehicle startups (and SPACs in general), Canoo became one of the talked about stocks with significant growth potential in the EV segment.

However, the hype soon dissipated. In April 2021, the SEC opened an investigation into the company’s merger with a special acquisition purpose company (SPAC), Hennessy Capital Acquisition Corp (HCAC), to go public. The scrutiny was part of a broader investigation that included several popular EV stocks such us Nikola (NKLA), Lordstown Motors (RIDE), and Faraday Future (FFIE).

The SEC informed the company that it believed, under its investigation, that certain former senior executives misled investors in late 2020 and early 2021 regarding revenue projections. In March 2021, new leadership revised the projections to zero after eliminating engineering services as a potential revenue stream.

Apple has not commented on the lawsuit. As it stands today, Kranz still works at the company as part of the Project Titan team. Bloomberg reports that Kranz is currently “overseeing hardware design for the car” and reports to Kevin Lynch.

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