By Jonathan Stempel

General Motors has won dismissal of a shareholder lawsuit accusing it of padding sales around the time of its November 2010 initial public offering by quietly unloading vehicle inventory on its dealers.

In a decision late Thursday, U.S. District Judge Laura Taylor Swain in Manhattan said the automaker disclosed in its IPO offering materials “all of the information necessary” about rising unsold vehicle supply for investors to determine whether it was “channel stuffing,” or building up excess inventory.

“That GM did not characterize this increase in inventory as ‘channel stuffing’ or accuse itself of ‘building up excess inventory on dealer lots,’ does render the disclosure document actionable,” Swain wrote. “GM need not characterize events in the most negative way possible as long as the particular negative trend is conveyed to investors.”

Led by the Teamsters Local 710 Pension Fund of Mokena, Illinois, investors in GM’s common and preferred stock claimed that the Detroit-based automaker’s disclosures created a false impression that sales and revenue were rising, and that GM was recovering from its June 2009 bankruptcy and federal bailout.

GM common shares were sold by the U.S. Treasury Department and other investors in the IPO at $33 each. But by July 2012, they had fallen 43 percent to as low as $18.72.

The plaintiff investors had sought to recoup their losses or rescind their purchases. GM’s IPO raised about $23 billion.

Samuel Rudman, a lawyer for the plaintiffs, and GM spokesman Patrick Morrissey did not immediately respond to a request for comment.

Several GM officials were also dismissed as defendants, including former Chief Executive Daniel Akerson and former Chairman Edward Whitacre.

The lawsuit predated and is separate from litigation over faulty ignition switches in GM vehicles.

The case is Scott v. General Motors Co et al, U.S. District Court, Southern District of New York, No. 12-05124.