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Robbins Geller Rudman & Dowd LLP today announced that a class action has been commenced on behalf of an institutional investor in the United States District Court for the Northern District of California on behalf of purchasers of Netflix, Inc. common stock during the period between December 20, 2010 and October 24, 2011.
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Darren Robbins of Robbins Geller at 800-449-4900 or 619-231-1058, or via e-mail at djr@rgrdlaw.com. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.rgrdlaw.com/cases/netflix. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges Netflix and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Netflix is a subscription service that streams television shows and movies over the Internet, and in the United States subscribers can have DVDs delivered to their homes.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business practices and its contracts with content providers. As a result of defendants’ false statements, Netflix’s stock traded at artificially inflated prices during the Class Period, reaching a high of almost $300 per share on July 13, 2011. While Netflix stock was inflated (partially by Netflix buying back its own stock), Company insiders were selling 388,661 shares of their own Netflix stock for proceeds of $90.2 million.
On September 15, 2011, Netflix updated its third quarter 2011 guidance and revealed that it had lost a million subscribers due to its recently announced price increases becoming effective. On this news, Netflix stock fell nearly $40 per share to close at just under $170 per share. On September 19, 2011, the Company announced that, in an effort to offset skyrocketing costs and rapidly defecting customers, the Company would begin charging separately for its two services and had raised prices as much as 60%. Netflix stock dropped to $130 per share on this news. Then, on October 24, 2011, Netflix issued its third quarter 2011 shareholder letter, which reported a net loss of 810,000 U.S. subscribers, translating into a cumulative loss of 5.5 million subscribers. The subsequently filed Form 10-Q revealed that Netflix’s obligations for content over the coming years had skyrocketed to $3.5 billion, with $2.8 billion due within three years. These disclosures caused Netflix stock to collapse from $118.84 per share on October 24, 2011 to $80.86 per share on October 27, 2011, a 32% decline in three days and a 73% decline from the stock’s Class Period high.
According to the complaint, the true facts, which were known by the defendants but concealed from the investing public during the Class Period, were as follows: (a) Netflix had short-term contracts with content providers and defendants were aware that the Company faced the choice of renegotiating the contracts in 2011 at much higher rates or not renewing them at all; (b) content providers were already demanding much higher license fees, which would dramatically alter Netflix’s business; (c) defendants recognized that Netflix’s pricing would have to dramatically increase to maintain profit margins given the streaming content costs they knew the Company would soon be incurring; and (d) Netflix was not on track to achieve the earnings forecasts made by and for the Company for 2011.
Plaintiff seeks to recover damages on behalf of all purchasers of Netflix common stock during the Class Period (the “Class”). The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Robbins Geller, a 180-lawyer firm with offices in San Diego, San Francisco, New York, Boca Raton, Washington, D.C., Philadelphia and Atlanta, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. The Robbins Geller Web site (http://www.rgrdlaw.com) has more information about the firm.
The law firm of Izard Nobel LLP, which has significant experience representing investors in prosecuting claims of securities fraud, announces that a lawsuit seeking class action status has been filed in the United States District Court for the District of Maryland on behalf of purchasers of the common stock of Human Genome Sciences, Inc. between July 20, 2009 and November 11, 2010, inclusive. Also included are those who acquired shares in the July 28, 2009 public offering at $14 per share and in the December 2, 2009 public offering at $26.75.
The Complaint charges that HGSI and certain of its officers and directors violated federal securities laws by issuing false and misleading statements concerning Benlysta®, HGSI's potential new drug for the treatment of Systemic Lupus Erythematosus, a chronic, life-threatening autoimmune disease. Specifically, the Complaint alleges that defendants failed to disclose that Benlysta was associated with suicide in clinical drug trials conducted by HGSI.
The Complaint alleges that when the U.S. Food and Drug Administration posted its analysis of Benlysta on the Internet on November 12, 2010, investors learned for the first time of the association between Benlysta and suicide in clinical trials, causing HGSI's common stock price to fall. Meanwhile, the Complaint alleges, during the Class Period, HGSI sold over 44 million shares of its common stock in public offerings at artificially inflated prices, receiving $850 million in net proceeds.
If you are a member of the class, you may, no later than January 10, 2012, request that the Court appoint you as lead plaintiff of the class. A lead plaintiff is a class member that acts on behalf of other class members in directing the litigation. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs make important decisions which could affect the overall recovery for class members.
While Izard Nobel LLP has not filed a lawsuit against the defendants, to view a copy of the Complaint initiating the class action or for more information about the case, and your rights, visit: www.izardnobel.com/humangenomesciences/, or contact Izard Nobel LLP toll-free: (800)797-5499, or by e-mail: firm@izardnobel.com. For more information about class action cases in general, please visit our website: www.izardnobel.com.
