LegalZoom.com, Inc. (LZ)
Whether directors and officers of LegalZoom.com, Inc. (LZ) breached their fiduciary duties to the company and its shareholders.
Investigation
12/16/2021
Initial Lawsuit
12/30/2021
Lawsuit Progression
03/29/2022
This investigation follows Muddy Waters Research’ short report on KE holdings alleging, among other information, home sales gross transaction value inflation and discrepancies in transaction volume, store count and agent count reported to investors.
This post is open for investors to gather facts, and findings and track their exposure to related lawsuits. We invite investors and shareholders to contribute to this investigation for their own benefit, add events to the factual timeline below and vote on events’ pertinence.
A lawsuit was subsequently filed. We update this post regularly.
12/16/2021
Muddy Waters Research publishes a short report about KE Holdings Inc. alleging “systemic fraud“, inflation of new home sales gross transaction volume (GTV) by over 126% and commission revenues by approximately 77-96%, along with “massive discrepancies between the transaction volumes, store count and agent count reported to investors.”
“Put simply, we found massive fraud, including a likely sham acquisition seemingly designed to mask the fraudulent revenues. Our field work found ghost stores, clone stores and undisclosed schemes to inflate revenues by round tripping cash through connected brokerages.”
Stock Impact
Close | Previous close | Price variation | Percentage variation |
---|---|---|---|
$18.31 | $18.68 | $-0.37 | -1.98% |
A KE Holdings investor filed a securities class action lawsuit on behalf of all persons or entities that purchased or otherwise acquired KE Holdings American depository shares (ADSs) between August 13, 2020, and December 16, 2021, inclusive.
According to the complaint, defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the company’s business, operations, and prospects. Specifically, defendants allegedly failed to disclose to investors that:
(a) Defendants inflated the Company’s GTV;
(b) Defendants inflated the Company’s revenues;
(c) Defendants inflated the number of stores and agents using the company’s platform; and
(d) As a result, of the foregoing, defendants’ statements about the company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
03/29/2022
The court issued an order appointing the lead plaintiff and lead counsel.
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