San Diego law firm Finkelstein & Krinsk LLP announced today that it is investigating a potential class action lawsuit against Netflix on behalf of current and former shareholders over alleged false and misleading business information issued by the streaming service’s executive officers.
In an email to VideoInk, Finkelstein & Krinsk LLP CEO Jeffrey R. Krinsk said that the potential suit would involve Netflix shareholders who purchased stock in Q3 2014.
Netflix finished the quarter with 37.2M subscribers in the U.S. and 15.84M internationally, falling below the 37.6M and 16.16M, respectively, it projected. A day after the numbers were announced, the value of Netflix shares dropped nearly 20%.
“We intend to reinforce the factual allegations and hope to hear from potential class members which allows us to detail the conduct we allege was improper to that person/business,” said Krinsk in his email.
Netflix did not respond to a request for comment.
In 2013, U.S. District Judge Samuel Conti in San Francisco dismissed a shareholder lawsuit against Netflix alleging that the company had misled them about pricing trends and the profitability of its streaming and DVD services as it prepared to spin them off into two separate businesses. Netflix’s share price fell 76% between July and October 2011, when the announced spinoff was aborted.