NEW YORK, Oct. 26, 2022 (GLOBE NEWSWIRE) — Bragar Eagel & Squire, PC, a nationally recognized shareholder rights law firm, reminds investors that a class action has been commenced on behalf of shareholders of Opendoor Technologies, Inc. (NASDAQ: OPEN), Schmitt Industries, Inc. (NASDAQ: SMIT), and Block, Inc. (NYSE: SQ). Shareholders have until the deadlines below to ask the court to act as lead plaintiff. More information on each case can be found at the link provided.
Opendoor Technologies, Inc. (NASDAQ: OPEN)
Class period: December 21, 2020 – September 16, 2022 or pursuant to the Company’s December 21, 2020 IPO
Lead Plaintiff Deadline: December 6, 2022
Opendoor was formerly known as Social Capital Hedosophia Holdings Corp. II (“SCH”) and operated as a special purpose acquisition company (“SPAC”), also called a blank check company, which is a development-stage company that has no specific business. plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies, other entity or person.
On September 15, 2020, the Company, then still operating as SCH, and Legacy Opendoor, a private company operating as a digital platform for residential real estate, announced their entry into a definitive agreement for the Merger (the “Merger Agreement”), which valued Legacy Opendoor at an enterprise value of $4.8 billion.
On October 5, 2020, the Company filed a registration statement on Form S-4 with the SEC in connection with the Merger, which, after several amendments, was declared effective by the SEC on November 27, 2020 (the “Registration Statement “). . On November 30, 2020, the Company filed a proxy statement/prospectus on Form 424B3 with the SEC in connection with the Merger, which formed part of the Registration Statement (the “Proxy” and, together with the Registration Statement, the “Offering Documents”). “).
On December 18, 2020, pursuant to the Merger Agreement, the Company, among other things, deregistered as a Cayman Islands company, registered as a Delaware company, changed its name to “Opendoor Technologies Inc.”, and completed the Merger, whereby, among among other things, Legacy Opendoor became a wholly owned subsidiary of the company.
After the Merger, the Company operated a digital platform for buying and selling residential properties in the U.S. The Company’s platform features a technology known as “iBuying,” which is an algorithm-based process that reportedly enables Opendoor to make accurate market-based. offer sellers for their homes, and then flip those homes to buyers for a profit.
On December 21, 2020, the post-Merger Company’s common stock and warrants began publicly trading on the Nasdaq Stock Market (“NASDAQ”) under the ticker symbols “OPEN” and “OPENW,” respectively.
On September 19, 2022, citing a review of industry data, Bloomberg reported that the Company appeared to have lost money on 42% of its transactions in August 2022 (as measured by the prices at which it bought and sold properties). Bloomberg further reported that the data were even worse in key markets such as Los Angeles, California, where Opendoor lost money on 55% of sales, and Phoenix, Arizona, where it lost money on 76% of sales. Worse, a global real estate tech strategist interviewed by BloombergMike DelPrete, predicted that, based on his analysis, September would probably be even worse for Opendoor than August. Bloomberg‘s findings highlighted the failure of Opendoor’s algorithm to adjust accurately to changing market conditions.
Following the Bloomberg report, Opendoor’s stock price fell $0.50 per share, or 12.32%, over the next two trading sessions, to close at $3.56 per share on September 20, 2022 – 88.61% decrease from the Company’s first post-Merger closing stock price of $31.25 per share on December 21, 2020 (the “Initial Closing Price”).
Since the time the complaint was filed, Opendoor’s common stock has traded significantly below the Initial Closing Price and continues to trade below its initial value of the Merger, harming investors.
According to the complaint, the Offer Documents for the Merger were negligently prepared and, as a result, contained false statements of material fact or omitted to state other facts necessary for the statements made not to be misleading and were not prepared in accordance with the rules and regulations governing their preparation. Additionally, during the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operations and prospects. Specifically, the Offering Documents and Defendants made false and/or misleading statements and/or failed to disclose that: (i) the algorithm (“Algorithm”) used by the Company to make offers for homes could not accurately adapt to changing home prices across the board. different market conditions and economic cycles; (ii) as a result, the Company was at increased risk of sustaining significant and repeated losses due to residential real estate price fluctuations; (iii) accordingly, Defendants exaggerated the purported benefits and competitive advantages of the Algorithm; and (iv) as a result, the public statements of the Offering Documents and Defendants during the Class Period were materially false and/or misleading and did not state information required to be stated therein.
For more information about the Opendoor class action go to: https://bespc.com/cases/OPEN
Schmitt Industries, Inc. (NASDAQ: SMIT)
Class period: September 1, 2020 – September 20, 2022
Lead Plaintiff Deadline: December 12, 2022
On September 20, 2022, after the market closed, Schmitt announced that its previous financial statements “can no longer be relied upon” and would require a representation, estimating that “the errors were cumulatively significant, resulting in an understatement of $330,203 in expenses for the first three quarters of the fiscal year.
On this news, Schmitt’s stock fell $0.68, or 17.9%, to close at $3.12 per share on September 21, 2022, hurting investors.
According to the lawsuit, defendants during the Class Period made false and/or misleading statements and/or failed to disclose that: (1) Schmitt Industries continuously downplayed its serious problems with internal controls; (2) The financial statements of Schmitt Industries from August 31, 2021 to the present included “certain errors”; (3) as a result, Schmitt Industries would have to restate its previously filed financial statements for certain periods; and (4) as a result, Defendants’ statements about its business, operations and prospects were materially false and misleading and/or lacked a reasonable basis at all material times.
For more information about the Schmitt class action go to: https://bespc.com/cases/SMIT
Block, Inc. (NWSE: SQ)
Class period: November 4, 2021 and April 4, 2022
Lead Plaintiff Deadline: December 12, 2022
Block, formerly known as Square, Inc., is a technology company that creates financial services tools. Block’s segments include Square, which offers financial tools for sellers, and Cash App, which provides financial tools for individuals.
On April 4, 2022, Block announced that a former employee had improperly downloaded certain reports from Block’s subsidiary, Cash App Investing, on December 10, 2021. The information in the reports included full client names and brokerage account numbers, as well as ticket value , brokerage portfolios, and/or stock trading. As many as 8.2 million Cash App Investing customers were affected. Before April 4, 2022, Block did not disclose this information to shareholders.
On this news, Block’s stock price fell by more than 6%, hurting investors.
The Block class action lawsuit alleges that defendants failed to disclose during the Class Period that: (i) Block lacked adequate protocols limiting access to customer-sensitive information; (ii) as a result, a former employee was able to download certain reports from Block’s subsidiary, Cash App investing, containing full client names and brokerage account numbers, as well as brokerage portfolio value, brokerage portfolio, and/or stock trading. ; and (iii) as a result, Block likely suffered serious harm including reputational harm.
For more information on the class action Block go to: https://bespc.com/cases/SQ
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Bragar Eagel & Squire, PC is a nationally recognized law firm with offices in New York, California, and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivatives and other complex litigation in state and federal courts across the country. For more information about the company, please visit www.bespc.com. Lawyer advertising. Previous results do not guarantee similar results.
Bragar Eagel & Squire, PC
Brandon Walker, Esq.
Melissa Fortunato, Esq.