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If only a subset of shareholders are suing, e.g. shareholders who bought shares between date X and date Y, they are only losing a fraction of a dollar in share
by greenshackle2 6y ago
If only a subset of shareholders are suing, e.g. shareholders who bought shares between date X and date Y, they are only losing a fraction of a dollar in share value for every dollar they win in the lawsuit. They are gaining at the expense of shareholders who are not part of the lawsuit.
(Ignoring court fees.. the suing shareholder is paying court fees on both ends, could end up being net negative.)
- titanomachy 6y agoWouldn't anyone who held shares during that time have standing for the lawsuit, regardless of when they bought them?
- greenshackle2 6y agoPossibly? I would have thought if the problem is artificially inflated price, shareholders who didn't buy or sell during the period are not affected, but to be honest I don't know how these suits work in details. Just picking at random off Google, I looked at the Pinterest suit, and it's a big shareholder suing Pinterest Inc... on behalf of Pinterest Inc. So yeah you might be right. Sounds very odd. https://www.scribd.com/document/486543528/Pinterest-Shareholder-Lawsuit https://www.scribd.com/document/486543528/Pinterest-Sharehol...