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Chegg, Inc. Class Action Lawsuit - CHGG

Company Name
Chegg, Inc.
Stock Symbol
CHGG
Class Period
May 5, 2020 to November 1, 2021
Motion Deadline
February 20, 2022
Court
Northern District of California
30 days left to seek lead plaintiff status

Case Summary

The Chegg class action lawsuit seeks to represent purchasers of Chegg, Inc. (NASDAQ: CHGG) common stock between May 5, 2020 and November 1, 2021, inclusive (the “Class Period”).  Commenced on December 22, 2021 in the Northern District of California, the Chegg class action lawsuit – captioned Leventhal v. Chegg, Inc., No. 21-cv-09953 – charges Chegg and certain of its top executives with violations of the Securities Exchange Act of 1934. 

If you wish to serve as lead plaintiff of the Chegg class action lawsuit, please provide your information by clicking here.  You can also contact attorney J.C. Sanchez of Robbins Geller by calling 800/449-4900 or via e-mail at jsanchez@rgrdlaw.com.  Lead plaintiff motions for the Chegg class action lawsuit must be filed with the court no later than February 22, 2022.

CASE ALLEGATIONS: Chegg is a provider of online research tools, online tutoring services, digital and physical textbook rentals, and other educational resources.  When the COVID-19 pandemic hit in early 2020, demand for Chegg’s services accelerated significantly as more students stayed at home.

The Chegg class action lawsuit alleges that, throughout the Class Period, defendants made false and misleading statements and failed to disclose that: (i) Chegg’s increase in subscribers, growth, and revenue had been a temporary effect of the COVID-19 pandemic that resulted in remote education for the vast majority of U.S. students and once the pandemic-related restrictions eased and students returned to campuses nationwide, Chegg’s extraordinary growth trends would end; (ii) Chegg’s subscriber and revenue growth were largely due to the facilitation of cheating – an unstable business proposition – rather than the strength of its business model or the acumen of its senior executives and directors; and (iii) as a result, Chegg’s current business metrics and financial prospects were not as strong as it had led the market to believe during the Class Period.

On November 1, 2021, Chegg revealed its financial results for the first quarter in which students returned to campus across the United States, revealing fewer-than-expected enrollments while failing to provide 2022 guidance.  In fact, Chegg’s CEO and President, defendant Daniel L. Rosensweig, admitted that defendants were aware of the slowdown in September 2021.  On this news, Chegg’s stock price fell by nearly 50%, damaging investors.

THE LEAD PLAINTIFF PROCESS: The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Chegg common stock during the Class Period to seek appointment as lead plaintiff in the Chegg class action lawsuit.  A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class.  A lead plaintiff acts on behalf of all other class members in directing the Chegg class action lawsuit.  The lead plaintiff can select a law firm of its choice to litigate the Chegg class action lawsuit.  An investor’s ability to share in any potential future recovery of the Chegg class action lawsuit is not dependent upon serving as lead plaintiff. 

ABOUT ROBBINS GELLER RUDMAN & DOWD LLP: With 200 lawyers in 9 offices nationwide, Robbins Geller Rudman & Dowd LLP is the largest U.S. law firm representing investors in securities class actions.  Robbins Geller attorneys have obtained many of the largest shareholder recoveries in history, including the largest securities class action recovery ever – $7.2 billion – in In re Enron Corp. Sec. Litig.  The 2020 ISS Securities Class Action Services Top 50 Report ranked Robbins Geller first for recovering $1.6 billion for investors that year, more than double the amount recovered by any other securities plaintiffs’ firm.

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