Form 10-Q United States Goods for: June 30

By on August 5, 2022 0

Wang Class Action

On July 10, 2020, purported shareholder Momo Wang filed a putative class action lawsuit, individually and on behalf of others like him, against defendants USO, USCF, John P. Love, Stuart P. Crumbaugh, Nicholas D. Gerber, Andrew F Ngim, Robert L. Nguyen, Peter M. Robinson, Gordon L. Ellis, Malcolm R. Fobes, III, ABN Amro, BNP Paribas Securities Corp., Citadel Securities LLC, Citigroup Global Markets Inc., Credit Suisse Securities USA LLC, Deutsche Bank Securities Inc., Goldman Sachs & Company, JP Morgan Securities Inc., Merrill Lynch Professional Clearing Corp., Morgan Stanley & Company Inc., Nomura Securities International Inc., RBC Capital Markets LLC, SG Americas Securities LLC, UBS Securities LLC and Virtu Financial BD LLC, in the United States District Court for the Northern District of California as Civil Action No. 3:20-cv-4596 (the “Wang Class Action”) .

The Wang class action asserted federal securities claims under the 1933 Act, challenging the disclosures in a registration statement dated March 19, 2020. It alleged that the defendants failed to disclose to investors of the USO some extraordinary market conditions and attendant risks that caused oil demand to fall precipitously, including the global COVID-19 pandemic and the oil price war between Saudi Arabia and Russia. The Wang class action lawsuit was voluntarily dismissed on August 4, 2020.

Mehan Action

On August 10, 2020, alleged shareholder Darshan Mehan filed a derivative action on behalf of nominal defendant USO, against defendants USCF, John P. Love, Stuart P. Crumbaugh, Nicholas D. Gerber, Andrew F Ngim, Robert L. Nguyen, Peter M. Robinson, Gordon L. Ellis and Malcolm R. Fobes, III (the “Mehan Action”). The action is pending in the Superior Court of the State of California for Alameda County under Case Number RG20070732.

The Mehan action alleges that the defendants breached their fiduciary duties to USO and failed to act in good faith in connection with a March 19, 2020 registration and offering statement and disclosures regarding certain terms extraordinary market events that caused a sharp drop in demand for oil, including the global COVID-19 pandemic and the oil price war between Saudi Arabia and Russia. The complaint seeks, on behalf of the USO, compensatory damages, restitution, equitable relief, attorneys’ fees, and costs. All Proceedings in Mehan Action Stayed Pending Resolution of Motion(s) to Dismiss In re: United States Oil Fund, LP Securities Litigation.

The USCF, USO and the other defendants intend to vigorously defend these claims.

In re United States Oil Fund, LP Derivative Litigation

On August 27, 2020, purported shareholders Michael Cantrell and AML Pharm. Inc. DBA Golden International has filed two separate derivative actions on behalf of nominal defendant USO, against defendants USCF, John P. Love, Stuart P. Crumbaugh, Andrew F Ngim, Gordon L. Ellis, Malcolm R. Fobes, III, Nicholas D. Gerber, Robert L. Nguyen and Peter M. Robinson in the United States District Court for the Southern District of New York in Civil Action No. 1:20-cv-06974 (the “Cantrell Action”) and Civil Action No. 1: 20-cv-06981 (the “AML Action”), respectively.

The complaints in the Cantrell and AML actions are almost identical. They each allege violations of Sections 10(b), 20(a) and 21D of the 1934 Act, Rule 10b-5 thereunder, and common law allegations of breach of fiduciary duty, enrichment without cause, abuse of control, gross mismanagement and waste. company assets. These allegations stem from the USO disclosures and the defendants’ alleged actions in light of the extraordinary market conditions in 2020 that caused a sharp drop in demand for oil, including the global COVID-19 pandemic and the price war. oil between Saudi Arabia and Russia. The complaints seek, on behalf of the USO, compensatory damages, restitution, equitable relief, attorneys’ fees, and costs. Plaintiffs in the Cantrell and AML Actions have marked their actions as relating to the Lucas Class Action.

The Court grouped the Cantrell and AML actions under the heading In re United States Oil Fund, LP Derivative Litigation, Civil Action No. 1:20-cv-06974 and appointed Co-Lead Counsel. All procedures in In re United States Oil Fund, LP Derivative Litigation are suspended pending the decision on the motion(s) to dismiss In re: United States Oil Fund, LP Securities Litigation.

The USCF, USO and other defendants intend to vigorously defend the claims in In re United States Oil Fund, LP Derivative Litigation.

Item 1A. Risk factors.

There have been no material changes in the risk factors previously disclosed in the Trust’s Annual Report on Form 10-K for the year ended December 31, 2021, filed February 25, 2022 (the “Form 10-K ”), except the Next.