Saxena White P.A. Files New Securities Fraud Class Action Against Upstart Holdings, Inc., with Expanded Class Period

BOCA RATON, Fla., May 19, 2022 (GLOBE NEWSWIRE) -- Saxena White P.A. has filed a securities fraud class action lawsuit (the “Class Action”) in the United States District Court for the Northern District of California against Upstart Holdings, Inc. (“Upstart” or the “Company”) (NASDAQ: UPST) and certain of its executive officers (collectively, “Defendants”). The Class Action asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and U.S. Securities and Exchange Commission Rule 10b-5 promulgated thereunder on behalf of all persons or entities that purchased Upstart securities between March 18, 2021 and May 9, 2022, inclusive (the “Class Period”), and were damaged thereby (the “Class”). A previous securities fraud class action complaint filed against Upstart asserted a shorter class period of November 9, 2021 through May 9, 2022. The Class Action filed by Saxena White is captioned: Plymouth County Retirement Association v. Upstart Holdings, Inc., et al., No. 3:22-cv-02973 (N.D. Cal.)

Upstart is a financial technology firm that uses artificial intelligence (“AI”) and data science to underwrite consumer credit. The Company partners with banks to offer credit to consumers, either through the Upstart website or through banking partner websites embedded with Upstart technology. Upstart claims that its underwriting process allows banking partners to originate credit with higher approval rates, lower loss rates, and a high degree of automation. Throughout the Class Period, Defendants claimed that the lack of loans the Company retained on its balance sheet ensured it only was exposed to limited credit risk. Further, Defendants assured investors the Company was “cognizant of the fluidity in the macro environment,” but was “not expecting any meaningful adverse impact from rising defaults on our volumes or economics.” Additionally, Upstart’s “technology and model-driven” growth “manifest[ed] as increasing conversion rates,” an important metric representing the number of rate inquiries that resulted in loan transactions.

The Class Action alleges that, during the Class Period, Defendants misled investors and/or failed to disclose: (1) Upstart’s AI underwriting model could not and did not adequately account for macroeconomic factors such as interest rate increases and the end of the U.S. government stimulus; (2) that, as a result, Upstart was experiencing negative impacts on its conversion rate; (3) that, as a result, the Company was reasonably likely to use its balance sheet to fund loans, rendering its balance sheet highly exposed to credit risk; and (4) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially false and/or misleading and/or lacked a reasonable basis.

The truth emerged after the markets closed on May 9, 2022, when Upstart released its financial results for the first quarter of 2022, which included a dramatic increase in loans on its balance sheet. Specifically, loans on the Company’s balance sheet had more than doubled in just one quarter: from $252.4 million for the period ending to December 31, 2021, to $597.9 million for the period ended March 31, 2022. During a related earnings call, Defendants attributed the increase of loans on the Company’s balance sheet to “rising interest rates and rising consumer delinquencies putting downward pressure on conversion.” In response to this news, Upstart’s stock price fell 56%, from a closing price of $77.13 per share on May 9, 2022, to a closing price of $33.61 per share on May 10, 2022.

If you purchased Upstart securities during the Class Period and were damaged thereby, you are a member of the “Class” and may be able to seek appointment as lead plaintiff. If you wish to apply to be lead plaintiff, a motion on your behalf must be filed with the U.S. District Court for the Northern District of California no later than July 12, 2022. The lead plaintiff is a court-appointed representative for absent members of the Class. You do not need to seek appointment as lead plaintiff to share in any Class recovery in the Class Action. If you are a Class member and there is a recovery for the Class, you can share in that recovery as an absent Class member.

You may contact David Kaplan (, an attorney and Director at Saxena White P.A., to discuss your rights regarding the appointment of lead plaintiff or your interest in the Class Action. You also may retain counsel of your choice to represent you in the Class Action.

You may obtain a copy of the Complaint and inquire about actively joining the Class Action at

Saxena White P.A., with offices in Florida, New York, California, and Delaware, is a leading national law firm focused on prosecuting securities class actions and other complex litigation on behalf of injured investors. Currently serving as lead counsel in numerous securities fraud class actions nationwide, Saxena White has recovered billions of dollars on behalf of injured investors.

David Kaplan, Esq.
Saxena White P.A.
12750 High Bluff Drive, Suite 475
San Diego, CA 92130
Tel: (858) 987-0860
Fax: (858) 369-0096