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Robinhood Meme Stock Class Action Lawsuit Overview:
- Who: Robinhood and other financial service firms including Apex Clearing Corp. and Citadel Securities LLC.
- Why: The companies are asking a judge to dismiss class action lawsuits filed against them alleging they colluded and violated antitrust laws by temporarily restricting transactions of volatile stocks, including GameStop.
- Where: The motion to dismiss was filed in Florida federal court.
Robinhood and other financial services firms are asking a Florida judge to throw out a series of class action lawsuits filed against them claiming restrictions imposed during January’s “meme stock” trading hysteria involving GameStop and other stocks of high volatility cost investors billions.
Robinhood argued in a motion filed Monday that the company was within its legal right to suspend transactions of the stock, pointing out it was facing a $3 billion collateral deposit demand from the National Securities Clearing Corporation.
“In order to remain in compliance with its deposit requirements, Robinhood Securities made the difficult decision to place limited restrictions on customer purchases on the small number of securities driving its deposit requirement,” the company said.
Robinhood Lawsuits Allege Billions Lost in Meme Stock Trading Restrictions
Investors accused Robinhood and other financial institutions of violating antitrust laws when they locked them out of buying or selling AMC Entertainment Holdings Inc. and GameStop stock as the latters price soared all the way to $483. The purchase restrictions cost investors a total of more than $10 billion in market capitalization losses, the class action lawsuits allege.
Plaintiffs further allege Robinhood artificially deflated the price of GameStop stock by refusing to let consumers buy or sell it, in order to help major hedge funds who were shorting the stock from losing money.
The Robinhood lawsuits accused the companies of negligence, gross negligence, negligence per se, and breach of fiduciary duty.
Financial Cos Fighting Meme Stock Class Actions
Other financial service firms, including Apex Clearing Corp. and Citadel Securities LLC, have fought back against claims they colluded with Robinhood to block price growth in the “meme stocks.”
Robinhood, meanwhile, is arguing that its customer agreement allows it to implement the kind of restrictions it put on the GameStop stock.
“Recognizing that they have no claim for breach of contract … plaintiffs now attempt to create liability in tort where none exists under contract law,” Robinhood said. “But the law does not permit Plaintiffs to take a losing breach of contract claim and dress it up as a tort claim in order to avoid the governing provisions of the Customer Agreement.”
Were you locked out of trading GameStop or any other stock by Robinhood or another financial services firm? Let us know in the comments!
The plaintiffs are represented by Natalia M. Salas, James L. Ferraro, James Ferraro, Jr., Bruce S. Rogow, Sean A. Burstyn and Daniel J. DiMatteo of The Ferraro Law Firm PA.
The antitrust plaintiffs are represented by Joseph R. Saveri, Steven N. Williams, Christopher K.L. Young and Anupama K. Reddy of Joseph Saveri Law Firm LLP and by Frank R. Schirripa, Kathryn Hettler, Seth Pavsner and Eugene Zaydfudim of Hach Rose Schirripa & Cheverie LLP.
Plaintiffs are also represented by lead counsel Peter Safirstein of Safirstein Metcalf LLP.
The Robinhood Investor Lawsuits are:
Days v. Robinhood Markets, Inc., et al., Case No. 3:21-cv-00696 in the U.S. District Court Northern District Of California, San Francisco Division.
Nelson v. Robinhood Financial LLC, et al., Case No. 1:21-cv-00777, in the U.S. District Court Southern District of New York.
Gatz, et al. v. Robinhood Financial, LLC, Case No. 1:21-cv-00490, in the U.S. District Court for the Northern District of Illinois, Eastern Division.
Nabi, et al. v. Robinhood Financial, LLC, Case No. 3:21-cv-00755 in the U.S. District Court Northern District Of California.
Simpson, et al. v. Robinhood Financial LLC, et al., Case No. 3:21-cv-00207 in the United States District Court Northern District of Texas, Dallas Division.
Don’t Miss Out!
Check out our list of Class Action Lawsuits and Class Action Settlements you may qualify to join!
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- Robinhood Sued for More Than $5M for Allegedly Sending ‘Illegal Spam Texts’
- Interactive Brokers Turned a Blind Eye to Fraud, Allowing $23M Ponzi Scheme to Continue, Class Action Alleges
- Robinhood Lost Investors $10B By Blocking Trade, Alleges Class Action Lawsuit
58 thoughts onRobinhood Asks Judge To Dismiss Class Action Lawsuits Filed For GameStop, ‘Meme’ Stock Restrictions
I have had some losses with Robinhood.
This whole time I haven’t been sure what case to join or what to do, but I have proof of losses of 100-300k from robinhood. The thing is they were options but that shouldn’t affect anything in my opinion. If anyone can help please contact me. I’ve made my peace but for some time I was quite literally suicidal, I’ve been poor my whole life and was living in my truck at the time. Felt like my one shot was stolen from me and nothing would ever happen to rectify it. I’m not giving up though.
The stock market is rigged, but Robinhood took this to an entirely new level. I had multiple broker accounts open and actively trading certain meme stocks – in particular – AMC. This shouldn’t just be a civil matter – what they did is criminal. I haven’t invested in the market since. Why? I was sitting on $30-35k+ in gains when AMC tripled in price overnight. Knowing that the hedgefunds were being bled dry having hyper leveraged their shorts and there would be an avalanche of orders coming in the next day, so I like many others here, was trying to buy every share of AMC I could get my hands on. As the shares skyrocketed, the stock exchange threw the safety switches and halted trading multiple times. As the stock jumped from $3 to ~$12 overnight, and then rocketed to $18 after open, I was sitting on the largest gain I’d ever seen in the stock market. That’s when Robinhood stepped in, followed by tradestation. I was able to buy another 2k shares (miraculously) just before Robinhood stepped in at $18/share. Robinhood was not yet a public company – they were in their late seed rounds of accredited investors and valued around $12-13B in the upcoming IPO. No one saw it coming, but if this isn’t market manipulation then nothing is. The GameStop fiasco had bankrupted one hedge fund w/ 2 more coming to it’s rescuing – it’s short positions had lost in the neighborhood of $40B and hedgies together an estimated $70-80B. Robinhood became collateral damage that was never collected – because they should have been run out of business – trading licenses revoked – and company leaders thrown in jail…instead they’re sitting (as of 9/30) on a $36B valued company…their value has nearly tripled. I guarantee you, the seed investors in robinhood were connected to the hedgefunds in more ways than one. Robinhood was a firebreak – they set fire to robinhood creating a one-way f’n street for its users to ONLY SELL the meme stocks to intentionally crater the meme stock prices – after all 99% of the meme stocks were small time investors playing the markets through robinhood’s app. You create that one way street – you create a panic the moment that news hits the wire – everyone sells.
I watched in disbelief as my $35k in gains jumped to $60k then cratered to a $5k loss within an hour of robinhood’s market manipulation. What’s worse – had AMC followed in GME’s footsteps – which it was almost certain to do before RH f’d ever little guy – I’d have been sitting on 7 figures if AMC had climbed half as high as GME. No way in h*** they should get away with this.
Please…PLEASE…if there is a class action lawsuit, I want my name posted front and center w/ every other investor that got screwed out of tens of thousands of dollars while the bast*** hedgefunds made and saved Billions. I would LOVE to John Hancock my name all over that class action suit. These f***ers belong in jail.
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I trusted Robinhood, I was new to this and I bought stock that disappeared out of my profile and I never was told why, so after that I sold all my stocks.. but when I looked back at the app I had .06 in my account. So I just closed it out.. now what do I do?? Some help please I would really appreciate it.
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They also stopped me from buying or selling AMC, Nokia, & Blackberry at the same time, Game stop was going up. I am pretty sure they will get lucky and find a crooked Judge to take the campaigned donation to throw it out.
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