On February 19, 2013, the Rosenfarb Law Firm filed a class action lawsuit (“Complaint”) in the Unites States District Court, Northern District of California, on behalf of all persons who purchased shares of Netflix, Inc. (“Netflix” or “the Company”) (NASDAQ: NFLX) between July 3, 2012 and July 24, 2012, inclusive (the “Class Period”), against the Company and certain of the Company’s officers and directors, alleging securities fraud pursuant to Sections 10(b) and 20(a) of the Securities Exchange Act [15 U.S.C. Sec. 78j(b) and 78(a)] and Rule 10b-5 promulgated thereunder by the SEC [17 C.F.R. Sec. 240.10b-5] (the “Class”).
Anyone who purchased shares of Netflix, Inc. during the Class Period may be entitled to recover damages.
According to the Complaint, on July 3, 2012, Netflix Chief Executive Officer Reed Hastings posted on the Company’s public Facebook page that “Netflix monthly viewing exceeded one billion hours for the first time ever in June.” Hasting’s Facebook statement led the market to believe that Netflix was on pace to achieve its projected target for the year of 7 million net additions in domestic subscribers, which Hastings expressed in an April 23, 2012 Earnings Call with optimism in reaching the target. The July 3, 2012 posting indicated that the Company was "continuing to execute on all of the key dimensions" and "everything was consistent with what [the Company had] been hoping for," leading the market to believe that Netflix was on "target for the year" to achieve the 7 million net additions. On this news, the price of Netflix stock skyrocketed to $81.72 per share, a 13.4 percent increase, on volume of almost 15 million shares.
However, on July 24, 2012, the Company disclosed its second quarter 2012 results, which revealed that Netflix had only achieved 530,000 net subscription additions to date. Further, the Company noted that it may not reach its target of adding 7 million domestic streaming subscribers by the end of the year. On this news, shares in Netflix fell 25%, closing at $60.28 per share on July 25, 2012, from a close of $80.39 per share on July 24, 2012, on volume of over 24 million shares.
Prospective participants who want to join this lawsuit please click here to submit the necessary information online or you may call Jorge Amador at (855) 255-1100 and tell him about your claim.
You may view the Complaint here