The Class: Robbins LLP informs investors that a shareholder filed a class action on behalf of all persons and entities who purchased or otherwise acquired Block, Inc. (NYSE: SQ) f/k/a Square Inc. securities between November 4, 2021 and April 4, 2022, including former shareholders of Afterpay securities who acquired unregistered Block, Inc. Class A common stock (and/or corresponding SQ CHESS Depository Interests ("CDI")) in direct exchange for Afterpay shares pursuant to Block's January 31, 2022 acquisition and stock-for-stock merger with Afterpay ("the Merger"). Block is a technology and financial service company that provides apps, tools, and services for credit card, in app, and other digital card payment process.
What Now: Similarly situated shareholders may be eligible to participate in the class action against Block. Shareholders who want to act as lead plaintiff for the class must file their papers by April 3, 2023. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery. For more information, click here.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
What is this Case About: Block Inc. (SQ) Unlawfully Sold Unregistered Securities
According to the complaint, on January 31, 2022, Block completed its acquisition of Afterpay, then an Australian limited company listed on the Australian Stock Exchange, pursuant to a scheme of arrangement under Australia’s Corporations Act 2001 (the “Scheme”). Pursuant to the financial terms of the Scheme, Block acquired all outstanding ordinary shares of Afterpay in exchange for 0.375 of a share of newly issued SQ class A common stock or corresponding SQ CDI. Block represented to the Afterpay shareholders that the "Square securities issued in the proposed transaction are anticipated to be issued in reliance upon an available exemption from … registration requirements pursuant to Section 3(a)(10) of the Securities Act." In connection with the Merger, Block offered and sold approximately 113 million unregistered Block shares directly to former Afterpay shareholder. But contrary to their representation to Afterpay’s Board and shareholders, defendants did not satisfy the mandatory conditions necessary to exempt them from registration under §3(a)(10) and permit the issuance and sale of unregistered Block Shares. Nevertheless, and in violation of §§5(a) and (c) of the Securities Act, no registration statement has been filed with the SEC or been in effect with respect to these Block Shares issued, solicited, and sold by means of the Merger.
Accordingly, during the class period, defendants: (i) deceived the investing public; (ii) artificially inflated and maintained the market price of Block securities; and (iii) caused class members to purchase or otherwise acquire Block securities at artificially inflated prices.
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