Uber Technologies, Inc. Class Action Lawsuit
- Company Name
- Uber Technologies, Inc.
- Stock Symbol
- Class Period
- Purchasers of Uber securities pursuant to the May 10, 2019 initial public offering
- Motion Deadline
- December 3, 2019
- Northern District of California
On October 4, 2019, the Uber Technologies, Inc. class action lawsuit was filed charging Uber, certain of its officers and directors, and the underwriters of its May 10, 2019 initial public offering (“IPO”) with violations of the Securities Act of 1933. The Uber class action lawsuit was commenced in the Northern District of California on behalf of purchasers of Uber securities pursuant to the IPO and is captioned Stirratt v. Uber Technologies, Inc., No. 3:19-cv-06361.
Uber is a ridesharing company that facilitates access to rides and meal delivery through the use of its mobile app.
On April 26, 2019, Uber filed the final amendment to its registration statement, registering over 200 million shares of Uber common stock for sale to the public. On May 9, 2019, the registration statement was declared effective by the U.S. Securities and Exchange Commission, and on May 13, 2019, Uber filed the prospectus for the IPO, which forms part of the registration statement (together the “Registration Statement”). On May 14, 2019, Uber completed the IPO, selling approximately 207 million shares of Uber stock at $45 per share, generating over $8 billion in gross proceeds for defendants.
The Uber class action lawsuit alleges that the Registration Statement contained untrue statements of material fact and/or omitted to state material facts both required by governing regulations and necessary to make the statements made not misleading. Specifically, the Registration Statement failed to disclose that, at the time of the IPO, Uber was rapidly increasing subsidies for customers’ rides and meals in a bid for market share, which caused Uber’s sales and marketing expenses to swell, and defendants were cutting (or planned to cut) costs in key areas that undermined Uber’s central growth opportunities.
In July 2019, Uber announced the termination of one third of its global marketing workforce, which was contrary to Uber’s representations in the Registration Statement that Uber was “focused on optimizing [its] performance marketing spend.” On this news, the price of Uber stock fell more than 13% to close at $39.05 per share by August 5, 2019.
Then on August 8, 2019, Uber announced severely negative second quarter 2019 financial results, including revenue of $3.16 billion and net losses of $5.2 billion. Further, Uber revealed that its ridesharing revenue growth had slumped to only 2% and that its sales and marketing expenses for the three and six months ended June 30, 2019 had spiked 70.9% and 62.5%, respectively. On this news, the price of Uber stock dropped another nearly 14% to $37 per share on August 12, 2019, and by the end of that week was trading as low as $33.22 per share.
Subsequently, Uber announced it would be laying off another 8% of its workforce, causing further declines in its stock price. By the beginning of October 2019, the price of Uber stock had fallen to $29 per share, a 34% decline from the $45 per share IPO price.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Uber securities pursuant to the IPO to seek appointment as lead plaintiff in the Uber class action lawsuit. A lead plaintiff will act on behalf of all other class members in directing the Uber class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Uber class action lawsuit. An investor’s ability to share in any potential future recovery of the Uber class action lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff of the Uber class action lawsuit or have questions concerning your rights regarding the Uber class action lawsuit, please provide your information here or contact counsel, Brian E. Cochran of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at email@example.com. Lead plaintiff motions for the Uber class action lawsuit must be filed with the court no later than December 3, 2019.
Robbins Geller Rudman & Dowd LLP is one of the world’s leading law firms representing investors in securities class action litigation. With 200 lawyers in 9 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For six consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in the world in both amount recovered for shareholders and total number of class action settlements. Robbins Geller attorneys have helped shape the securities laws and have recovered tens of billions of dollars on behalf of aggrieved victims. Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide. Robbins Geller attorneys are consistently recognized by courts, professional organizations and the media as leading lawyers in the industry.