Twitter Coughing Up Over $800 Million To Settle Lawsuit For Investor 'Fraud'
Twitter settled a lawsuit on Monday and announced that it would pay $809.5 million to investors, who claim to have been "deceived" by the social networking platform.With the shareholder class action lawsuit settlement set at $809.5 million (?5,960 crores), the company prevented the case from going to trial in the United States.?
What is the case against Twitter about?
In September 2016, Twitter shareholders alleged that the company had inflated its stock price by feeding them misleading data about user engagement on the platform.?
In the complaint, shareholders claimed that Twitter gave them vague descriptions about measurable user metrics on the platform about user engagement. In late 2014, Twitter also continued sharing its "timeline views", the complaint mentions.?
Jury selection for the case was set to begin on Monday, and Twitter's hasty settlement points to the power juries possess in the United States and how trials against tech companies in the US could change the tune.?
Twitter's former CEO Richard Costolo and former CFO Anthony Noto have denied any wrongdoing while agreeing to the settlement.Twitter claims that it will use cash on hand to pay the settlement amount in the fourth quarter of 2021.?
In the complaint, shareholders added how Twitter accepted that it was providing misleading data after Costolo left the company in June 2015.The lawsuit covers investors who purchased Twitter stocks between February 6, 2015 and July 28, 2015.?
Also read:?Here's Why People Are Sharing Pictures Of Their Fathers With The Hashtag 'Abba Jaan' On Twitter
Only nine of over 5,000 US securities class action cases that were filed by stock investors have gone through trial to a verdict since 1996, Securities Class Action Clearinghouse was cited by Reuters as claiming. In addition, over half of the lawsuits are dismissed while the rest are settled just like this one.?
Do you think Twitter is taking the easy way out by settling the lawsuit after "deceiving" its shareholders? Let us know in the comments below.For the latest in the world of science and technology, keep following Indiatimes.com.? ??
