Law Firm Pomerantz Announces Class Action Filing
NEW YORK, April 01, 2022 (GLOBE NEWSWIRE) — Pomerantz LLP announces that a class action lawsuit has been filed against Affirm Holdings, Inc. (“Affirm” or the “Company”) (NASDAQ: AFRM) and certain of its officers . The class action, filed in the United States District Court for the Northern District of California and registered as 22-cv-02099, is on behalf of a class consisting of all persons and entities other than defendants who purchased or otherwise acquired Affirm securities between February 12, 2021 and February 10, 2022, both dates inclusive (the “Class Period”), seeking to recover damages caused by the Defendants’ violations of federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder, to against the Company and certain of its senior executives.
If you are a shareholder who purchased or otherwise acquired securities of Affirm during the class period, you have until April 29, 2022 to ask the court to appoint you as the lead plaintiff in the class. A copy of the complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at [email protected] or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 7980. Those applying by email are encouraged to include their mailing address, phone number and number of shares purchased.
[Click here for information about joining the class action]
Affirm operates a platform for digital and mobile commerce in the United States and Canada. The Company’s platform includes point-of-sale payment solutions for consumers, commerce solutions for merchants and a consumer-centric application. In particular, Affirm offers a payment service called “buy now, pay later” (“BNPL”), which allows consumers to purchase a product immediately and pay for it later, usually in instalments. According to the Society, “[u]Unlike older payment options and our competitors’ product offerings, which charge deferred or compound interest and unexpected costs, we disclose to consumers up-front exactly what they’ll owe – no hidden fees, no penalties .
Affirm also maintains an official Twitter account, through which it posts statements – or “tweets” – including periodic financial results.
The Complaint alleges that throughout the Class Period, the Defendants made materially false and misleading statements regarding the company’s business, operations and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Affirm’s BNPL service facilitated excessive consumer indebtedness, regulatory arbitrage and data collection ; (ii) the foregoing has subjected Affirm to increased risk of regulatory review and enforcement action; (iii) Affirm maintained inadequate disclosure controls and procedures and internal control over financial reporting; (iv) as a result, Affirm’s tweet for its second quarter 2022 financial results contained selected metrics that gave the impression that the company performed better than it actually did; and (v) as a result, the Company’s public statements were materially false and misleading at all material times.
On December 16, 2021, the Consumer Financial Protection Bureau (the “CFPB”) announced that it had opened an investigation into Affirm’s BNPL payment service, along with four other companies offering BNPL. The CFPB said it was concerned about how BNPL led to “debt accumulation, regulatory arbitrage and data collection” and was seeking data on the risks and benefits of the products. In a statement addressed to the services of the BNPL, the director of the CFPB declared: “[t]The consumer receives the product immediately, but he also incurs the debt immediately.
On this news, Affirm’s stock price fell $11.74 per share, or 10.58%, to close at $99.24 per share on December 16, 2021.
Then, at approximately 1:15 p.m. on February 10, 2022, Affirm posted a tweet from its official Twitter account, in which the company disclosed certain measures of its second quarter 2022 financial results. The tweet, which was posted before the scheduled publication of its financial results by the company, described a very successful quarter, which included a 77% increase in revenue. This sent Affirm’s stock price up nearly 10% in intraday trading. The company later deleted the tweet and released its full second-quarter financial results ahead of schedule, which were lackluster, posting a loss of $0.57 per share, versus analyst expectations of $0.37 per share.
As a result of this news, Affirm’s stock price fell from an intraday high of $83.57 per share on February 10, 2022 to close at $58.68 per share, or about 32%.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, Paris and Tel Aviv, is recognized as one of the leading firms in the areas of corporate litigation, securities and antitrust. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues the tradition he established, fighting for the rights of victims of securities fraud, breaches of fiduciary duty and corporate misconduct. The firm recovered numerous multimillion-dollar damages on behalf of class members. To see www.pomlaw.com
Robert S. Willoughby
888-476-6529 ext. 7980