The litigation centers on Pentwater Capital Management LP, which allegedly operated as a corporate insider while holding more than 10% of Avis Budget Group stock. According to the complaint, the firm utilized common stock and cash-settled swaps to build an economic interest of approximately 51%, effectively becoming the dominant force in the market for CAR shares. The lawsuit claims that Pentwater executed a two-day sale of 4.3 million shares, generating $1.75 billion, which triggered a 74.51% collapse in the company’s stock price.

While Avis disclosed on June 18, 2026, that Pentwater agreed to a $650 million settlement regarding Section 16(b) violations of the Exchange Act, the current class action asserts that this recovery does not compensate public purchasers who bought stock at prices allegedly distorted by the firm's trading patterns. The lawsuit seeks damages under Sections 9(a) and 10(b) of the Securities Exchange Act, arguing that investors were harmed by market manipulation rather than fundamental business results. Levi & Korsinsky, LLP, which is representing the class, notes that eligibility for potential recovery is based on purchase dates and documented losses, regardless of whether the shares are still held.