Following their historic first quarterly drop in their total number of subscribers which was reported last month, Netflix is being sued by some shareholders for alleged securities fraud.

Specifically the complaint accuses Netflix executives of unlawfully withholding details of slowed customer acquisition due to factors like account sharing, dating back to its third quarter earnings report delivered on October 19 last year.

Our legal knowledge is extremely limited but our understanding is that publicly listed (i.e. on the stock exchange) companies must regularly disclose certain information to the general public in financial reports.

These days they're available online.

The idea is that both existing and potential investors have a right to that information so that they can make informed decisions.

But the reports aren't a tell-all. Publicly listed companies are also in competition with other businesses and are permitted to keep some information to themselves.

We don't know which category the information from this suit would fall into or when Netflix knew it.

Also in the woe department, after laying off staff from their Tudum fan site, allegations of managerial incompetence and PR censorship have surfaced.

[ Main Image: Netflix logo. Credit: Netflix. ]

References

Sato, Mia (May 6, 2022). Netflix tried and failed to build fandom with Tudum. The Verge.

Spangler, Todd (May 4, 2022). Netflix Targeted With Shareholder Lawsuit Alleging Securities Fraud After Subscriber Miss. Variety.

Netflix. Tudum. (viewed May 8, 2022)