fermi inc. -- project matador ipo securities fraud
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case overview
multiple securities class actions have been filed against fermi inc. following the collapse of its flagship ai data center project. the company went public in october 2025 at $21/share on the promise of “project matador” — an 11-gigawatt nuclear-powered ai data center campus — only to see its anchor tenant terminate a $150 million funding agreement two months later.
| Case | Salvatore Lupia v. Fermi Inc., No. 1:26-cv-00050 |
| Court | U.S. District Court, Southern District of New York |
| Filed | January 2026 |
| Class Period | October 1, 2025 — December 11, 2025 |
| Lead Plaintiff Deadline | March 6, 2026 |
| IPO Price | $21.00/share |
| Post-Disclosure Low | $8.59/share (-59%) |
| Status | Active |
allegations
the complaint alleges violations of sections 11, 12(a)(2), and 15 of the securities act of 1933 and sections 10(b) and 20(a) of the securities exchange act of 1934:
- inflated demand: fermi’s ipo registration statement inflated actual demand for project matador’s multi-gigawatt capacity to attract high-valuation multiples
- single-tenant dependency: the company misrepresented and failed to disclose the extent to which project matador relied on a single tenant’s $150 million advance in aid of construction agreement (aica) to finance construction
- termination risk concealment: there was a significant undisclosed risk that the tenant would terminate its funding commitment
the contract problem: firm commitment vs. purchase option
this case illustrates a pattern of concern across the data center sector. fermi presented its anchor tenant relationship as a strong commitment:
- as late as mid-november 2025, management assured investors that “tenant number 1 is a very creditworthy counterparty”
- the company described the arrangement as a $150 million “advance in aid of construction agreement”
however, the underlying agreements told a different story:
- the sec filings disclosed fermi had not yet entered into any binding contracts with tenants
- the company was working through nonbinding mous and letters of intent
- the aica itself contained an exclusivity period that the tenant could allow to expire
in other words, what was presented to investors as a committed customer relationship was structurally more like a purchase option — the tenant had exclusivity to negotiate but no binding obligation to proceed.
key events
october 1, 2025
fermi completed its ipo, selling 37,375,000 shares at $21.00/share for net proceeds of approximately $745.7 million. co-founded by former energy secretary rick perry, the company positioned itself as building the “world’s largest private energy campus” for ai data centers.
mid-november 2025
management publicly assured investors of strong tenant commitments and described tenant number 1 as a “very creditworthy counterparty.”
december 12, 2025
fermi disclosed that the first tenant had terminated the $150 million aica after the exclusivity period expired. stock plummeted 33.8% in a single day to $10.09. the stock subsequently traded as low as $8.59 — a 59% decline from the ipo price.
significance
the fermi case is likely to become a template for future data center litigation. as companies increasingly question ai investments, the gap between how customer contracts are characterized to investors and what the contract language actually permits will be a recurring securities fraud theory.
the case also highlights the risks of pre-revenue, single-project companies going public during periods of ai infrastructure enthusiasm.
sources
- hagens berman: fermi securities class action
- bfa law: fermi class action
- globenewswire: frmi alert
- latitude media: is fermi america’s ipo all hype?
last updated: february 22, 2026