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Snap Inc. has received subpoenas from the federal government relating to a class action arising from its initial public offering.
November 14, 2018 at 20h16
Feds Subpoena Snap Over Shareholder Action
DOSSIER – On this Wednesday, February 7, 2018, in the photo archive, the Snap Inc. logo appears above a trading post on the floor of the New York Stock Exchange. Snap Inc. has received subpoenas from the federal government relating to a class action arising from its initial public offering. The lawsuit alleges that Snap misled investors about growing its number of users before making it public. The company said in a statement Wednesday, November 14, 2018 that it responds to subpoenas and requests for information from the Securities and Exchange Commission and the Department of Justice. (AP Photo / Richard Drew, File) The Associated Press
NEW YORK (AP) – Snap Inc. has received federal summonses related to a class action arising from its initial public offering.
The lawsuit, filed last May, claims that Snap misled investors about growth in its number of users before becoming public.
The company said Wednesday in a statement that it had responded to subpoenas and requests for information from the Securities and Exchange Commission and the Department of Justice. The company claims to have understood that regulators are studying information during its initial public offering on Instagram competition.
SEC and DOJ declined to comment. Snap stated that it believed the lawsuit was "baseless" and that the information provided following its IPO was "accurate and complete".
Snap had a hard time competing with Instagram especially after the Facebook-owned application successfully copied its much-loved "stories" feature.
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