NEW YORK, May 17, 2017 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a class action lawsuit has been filed against Snap, Inc. (“Snap” or the “Company”) (NYSE:SNAP) in the United States District Court for the Central District of California on behalf of a class consisting of persons or entities who purchased the Company’s shares (1) pursuant and/or traceable to Snap’s false and misleading Registration Statement and Prospectus, issued in connection with its initial public offering on or about March 2, 2017 (the “IPO”); and/or (2) on the open market between March 2, 2017 and May 15, 2017 inclusive (the “Class Period”) for violations of § 10(b) and § 20(a) of the Securities Exchange Act of 1934 and U.S. Securities and Exchange Commission Rule 10b-5 promulgated thereunder, as well as § 11 and § 15 of the Securities Act of 1933.
The Complaint alleges that during the Class Period, Snap made materially false and misleading statements about its reported user growth. On March 3, 2017, the Company completed its IPO, issuing 200 million shares of stock. On May 10, 2017, after the market closed, Snap released its first earnings report as a public company. The report revealed disappointing user growth for the Company’s messaging platform and a quarterly loss of $2.2 billion. The user growth was the slowest year-to-year user growth rate in at least two years. Following this news, Snap’s stock price dropped 21.45%, which caused investors harm. On May 16, 2017, Anthony Pompliano, a former Snap employee, filed a federal lawsuit against the Company for terminating his employment because he raised questions about false growth metrics being represented to the public in order to inflate Snap’s valuation prior to the IPO. Mr. Pompliano is also seeking whistleblower protection against retaliation by the Company.
If you wish to serve as lead plaintiff, you must move the Court no later than July 17, 2017. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to join the litigation, or to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at tjmckenna@gme-law.com or gegleston@gme-law.com.
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