Block, Inc.
Lead Plaintiff Deadline 04/03/2023
The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Northern District of California on behalf of those who acquired Block, Inc. (“Block”) (NYSE: SQ) securities between November 04, 2021 through April 4, 2022 (the “Class Period”). Investors have until April 3, 2023 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
Block operates as a financial services and digital payments company, with headquarters in San Francisco, California.
On January 31, 2022, Block completed its acquisition of Afterpay, stating as a material term of the merger that the securities issued would be exempt from certain registration requirements with the SEC. However, defendants did not satisfy the mandatory conditions necessary for exemption, thus violating the Securities Act with their failure to file a registration statement.
On December 17, 2021, Block notified its shareholders that a ‘fairness’ hearing had been conducted before the New South Wales Court, which had approved the merger. On April 4, 2022, Block disclosed through an 8-K form filed with the SEC that a massive data breach had occurred over four months earlier, before the December 17, 2021 fairness hearing before the NSW Court and well before the annuary 31, 2022 Merger exchange. The Company then admitted that it had already determined that “a former employee downloaded certain reports of its subsidiary Cash App Investing LLC on December 10, 2021, that contained some U.S. customer information.” On this news, the price of Block shares declined by $9.27 per share, or approximately 6.38%, from $145.19 per share to close at $135.92 on April 5, 2022.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose: (i) the Company’s long history of derelict data security; (ii) the inexcusable failure to comply with baseline industry and regulatory data security standards; and (iii) the consequently massive yet undisclosed data breach that had Block had already suffered well before the date of the NSW Court fairness hearing.