Beyond Meat's stock price suddenly soared by 20%, but the reason behind it is a bit absurd. The company has just been fined $38.9 million for a trademark infringement case — an amount that is more than half of its Q3 revenue.

It looks terrible on the surface, right? But the stock price is still rising, closing up 8% in the end. What’s the operation? High short positions + retail FOMO. This stock became a meme stock last month, soaring 300% in the short term, with short positions accounting for over 20% of the circulating shares. Today’s surge is mostly due to short covering leading to a short squeeze.

The legal case itself stems from Vegadelphia Foods suing BYND and Dunkin' for using the advertising phrase "great taste, plant-based," which infringes on their federal trademark. Dunkin' settled last year, while Beyond Meat chose to appeal.

Interestingly, this plant-based meat company had a revenue of only 70.2 million US dollars in Q3, and the amount they were ordered to pay in damages is equivalent to more than ten days' worth of income. In the long term, this is indeed a problem, but the short-term fluctuations in stock prices are more about sentiment and technical factors.