Robbins Umeda LLP Announces an Investigation of Netflix, Inc.
Robbins Umeda is investigating possible breaches of fiduciary duty and other violations of the law by certain officers and directors at Netflix, Inc. (NASDAQ: NFLX). Concerned shareholders who would like more information about their rights and potential remedies can complete the form below and we will contact you directly. You can also contact attorney Gregory E. Del Gaizo at (800) 350-6003.
Robbins Umeda LLP’s investigation focuses on whether officials at Netflix breached their fiduciary duties to shareholders, maintained inadequate controls, and wasted corporate assets to the detriment of the company and investors. In particular, the firm is investigating allegations that members of the board of directors were unjustly enriched by a scheme that caused Netflix to buyback the company’s stock at artificially inflated prices.
In particular, between 2007 and June 30, 2011, members of the board oversaw the Company’s purchase of $994 million worth of its own company’s stock at allegedly inflated prices. Further, fiduciaries of the company continued with the ill-advised buyback program despite the fact that: (a) Netflix would soon be forced to raise subscription costs; (b) that the company was losing access to some of its premium content; and (c) that officials were planning to separate the company’s mail and online service platforms.
Recently, Netflix announced fee increases, changes in content and services, and a substantial decline in subscribers. These disclosures have caused the value of Netflix shares to plummet by over 70%. Additionally, it is alleged that prior to these disclosures, while shares of Netflix traded at artificially high prices, individual members of the board exercised and sold stock options worth hundreds of millions of dollars. Together, these actions by officials have subject Netflix to costly public and legal scrutiny that continues to harm the company and investors.
Robbins Umeda LLP highlights that Netflix shareholders have the option to file a derivative action to hold those officers and directors accountable for damaging the company. Remedies commonly sought in derivative actions include corporate governance reforms designed to prevent future misconduct, removal of officers or directors whose misconduct injured the corporation, and monetary payments in the form of damages and disgorgement of ill-gotten gains.
Robbins Umeda LLP is a nationally recognized leader in securities litigation and shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested.