NEW YORK, March 15, 2017 /PRNewswire/ -- Kaplan Fox
& Kilsheimer LLP (www.kaplanfox.com) is investigating claims on
behalf of investors of Netflix, Inc. ("Netflix" or the "Company")
(NASDAQ: NFLX).
A class action complaint has been filed in the United States
District Court, Northern District of California against Netflix and certain
officers of the Company on behalf of purchasers of Netflix's common
stock between July 22, 2014 and
October 15, 2014, inclusive (the
"Class"), alleging violations of the Securities Exchange Act of
1934 (the "Exchange Act").
The complaint alleges that the defendants made materially false
and misleading statements and omissions during the Class Period in
violation of the Exchange Act concerning Netflix's May 2014 price increase for monthly streaming
subscriptions.
According to the complaint, on July 21,
2014 – more than two months after Netflix's price increase
took effect – the Company's Chief Executive Officer and Chief
Financial Officer told the market that the impact of Netflix's
May 2014 price increase on subscriber
growth had been "minimal" and had "no noticeable effect in the
business." They also suggested that there would be no further
impact, stating, "I think we've seen, really, the impact of the
price change go through already, so it's pretty nominal." However,
contrary to their statements, the defendants had allegedly already
seen a marked decrease in subscriber growth due to the May 9 price increase, which was mostly concealed
from the public by the positive impact of the June 6 release of a new season of a popular
Netflix program.
The complaint further alleges that less than three months later,
on October 15, 2014, the Company
revealed that the impact of the price increase on subscriber growth
had been hugely negative. In fact, Netflix's subscriber
growth numbers were allegedly so low that this caused the
defendants to slash their projected earnings by almost fifty
percent. In an explanatory letter to shareholders dated
October 15, 2014, the Company stated
"[Y]ear on year net additions in the US were down (1.3 million in
Q3 2013 to [less than] 1 million in Q3 2014). As best we can tell,
the primary cause is the slightly higher prices we now have
compared to a year ago." They also admitted that there had been a
significant impact in Q2, which had been partially offset by the
release of a new season of a popular program.
In response to this news, on October 16,
2014, Netflix's stock price plummeted from the prior day's
closing price of $448.59 per share to
close at $361.70 per share, a nearly
20% decline erasing more than $5
billion of the Company's market value in one day.
If you are a member of the proposed Class, you may move the
court no later than May 1, 2017 to
serve as a lead plaintiff for the purported Class. You need
not seek to become a lead plaintiff in order to share in any
possible recovery. If you would like to discuss the complaint
or our investigation, please contact us by emailing
pmayer@kaplanfox.com or by calling 800-290-1952.
This press release may be considered Attorney Advertising in
some jurisdictions under the applicable law and ethical rules.
Kaplan Fox & Kilsheimer LLP,
with offices in New York,
San Francisco, Los Angeles, Chicago and New
Jersey, has many years of experience in prosecuting investor
class actions. For more information about Kaplan Fox & Kilsheimer LLP, you may visit
our website at www.kaplanfox.com. If you have any questions
about this Notice, the action, your rights, or your interests,
please contact:
Melinda D. Campbell
KAPLAN FOX & KILSHEIMER LLP
850 Third Avenue, 14th Floor
New York, New York 10022
(800) 290-1952
(212) 687-1980
Fax: (212) 687-7714
E-mail: mcampbell@kaplanfox.com
Laurence D. King
KAPLAN FOX & KILSHEIMER LLP
350 Sansome Street, Suite 400
San Francisco, California
94104
(415) 772-4700
Fax: (415) 772-4707
E-mail: lking@kaplanfox.com
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SOURCE Kaplan Fox &
Kilsheimer LLP