Shareholders File Class-Action Lawsuit Against Netflix

in Movies & TV

millie bobby brown and ensemble in stranger things

Credit: Netflix

In recent months, Netflix — formerly the king of streaming services — has been struggling to maintain subscribers amid the rise of other options like Disney+, Hulu, HBO Max, Peacock, and more.

Maya Hawke as Robin Buckley (left), Joe Keery as Steve Harrington (middle), and Gaten Matarazzo as Dustin Henderson (right)
Credit: Netflix

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Adding insult to injury, Netflix recently lost the rights to all of its Marvel series — Daredevil, Jessica Jones, The Punisher, Luke Cage, Iron Fist, and The Defenders.

elektra (left) and daredevil (right)
Credit: Netflix

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The shows have now landed on Disney+ following the official Marvel Cinematic Universe debuts of two fan-favorite Daredevil characters, Matt Murdock/Daredevil (Charlie Cox) in Spider-Man: No Way Home (2021) and Wilson Fisk/Kingpin (Vincent D’Onofrio) in Jeremy Renner and Hailee Steinfeld’s Disney+ Original Hawkeye series.

Things have been so touch-and-go for the streamer, in fact, that one analyst recently insisted Netflix needed to make “drastic changes” in order to survive.

bridgerton full cast
Credit: Netflix

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Among the few recent bright spots for the streamer are Bridgerton — which has actually been less popular during its second season — and the upcoming fourth season of hit series Stranger Things.

Netflix will also release the controversial NC-17 rated Marilyn Monroe biopic, Blonde, later this year.

marilyn monroe laughing
Credit: ABC

Now, the company is being sued by its shareholders for “misleading statements” made during a quarterly call. Business Wire shared details about the class action lawsuit, which is being handled by the law office of Glancy Prongay & Murray LLP.

The suit itself alleges that Netflix “made materially false and/or misleading statements” that cost investors who owned shares between October 2021 to April 2022 a good deal of money.

The Defenders
Credit: Netflix

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Per Business Wire‘s report:

On January 20, 2022, after the market closed, Netflix reported that it “slightly over-forecasted paid net adds in Q4,” adding 8.3 million subscribers compared to the 8.5 million forecast. The Company also stated that, despite “healthy” retention and engagement, it only expected to add 2.5 million net subscribers during first quarter 2022, below the 4.0 million net adds in the prior year period.

On this news, the Company’s stock price fell $110.75, or 21.7%, to close at $397.50 per share on January 21, 2022, on unusually heavy trading volume.

Then, on April 19, 2022, after the market closed, Netflix reported that it lost 200,000 subscribers during the first quarter of 2022, compared to prior guidance expecting the Company to add 2.5 million net subscribers. The Company cited the slowing revenue growth to four factors, including account sharing with an estimated 100 million additional households and competition with other streaming services.

On this news, the Company’s share price fell $122.42, or over 35%, to close at $226.19 per share on April 20, 2022, on unusually heavy trading volume.

jennifer lawrence (left) and leonardo dicaprio (right) in don't look up
Credit: Netflix

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If you believe you may be entitled to compensation as a Netflix shareholder, you can join the class-action lawsuit by visiting https://www.glancylaw.com/cases/netflix-inc-1/, calling 1-888-773-9224, or emailing shareholders@glancylaw.com.

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