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Suit claims company concealed decline in signups.
A class-action lawsuit against Netflix alleges that the company misled its investors over the precipitous decline in subscribers the company suffered in the first quarter of this year.
The suit, filed in the United States District Court of Northern California, alleges that the streaming company âmade materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Companyâs business, operations, and prospects,â related to that decline.
The company failed to reveal that it âwas exhibiting slower acquisition growth due to, among other things, account sharing by customers and increased competition from other streaming,â the suit claims, claiming that it was âlosing subscribers on a net basis.â
The suit is asking for âcompensatory damages ⊠for all damages sustained as a result of [Netflixâs alleged] wrongdoing, in an amount to be proven at trial, including interest thereon.â