File – This April 27, 2021 file photo shows the login / sign-up screen for a Twitter account on a laptop computer in Orlando, Florida. The company misleads investors about how much the user base is growing and how users have interacted with the platform. (AP Photo / John Raoux, file)
San Francisco (AP) — Twitter announced on Monday that it will pay $ 89.5 million in a class action settlement for misleading investors about expanding its user base and the amount of interaction with the platform.
The San Francisco company said the proposed settlement would still have to be approved by the judge, but Twitter would resolve all claims for the settlement without admitting fraud. In the first lawsuit filed by Twitter investor Doris Shenwick in 2016, Twitter executives “intentionally made inaccurate official statements about these indicators and did not disclose inside information about them, causing stock prices to skyrocket. And it fell when the truth about user engagement was revealed. ” .. “
The company said it plans to use its cash to pay the settlement in the fourth quarter of 2021. As a result, a one-time bill will be recorded.
According to the proceedings, Twitter executives expect the site’s average monthly user base to grow significantly to “more than 550 million” in the medium term and “more than 1 billion” in the long run, according to Twitter executives. Said that.
In 2019, Twitter stopped reporting monthly user numbers. Finally, counting the spring, the number was 330 million. Currently, Twitter only reports daily user numbers.
And in 2017, Twitter said it accidentally exaggerated monthly users because it included users of third-party apps that shouldn’t be there.
Twitter Inc.’s share price fell $ 2.50 (4%) to $ 59.95 in the afternoon trading.
Twitter pays $ 89.5 million to resolve derivative suit | WGN Radio 720
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