NEW YORK - (NewMediaWire) - September 14, 2020 - Faruqi & Faruqi, LLP, a leading national securities law firm, reminds investors in Fastly, Inc. (“Fastly” or the “Company”) (NYSE:FSLY) of the October 26, 2020 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
If you invested in Fastly stock or options between May 6, 2020 and August 5, 2020 and would like to discuss your legal rights, click here: www.faruqilaw.com/FSLY. There is no cost or obligation to you.
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The lawsuit has been filed in the U.S. District Court for the Northern District of California on behalf of all those who purchased Fastly securities between May 6, 2020 and August 5, 2020 (the “Class Period”). The case, Betancourt v. Fastly, Inc. et al, No. 20-cv-06024 was filed on August 27, 2020.
As detailed below, the lawsuit focuses on whether the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose: (1) that Fastly’s largest customer was ByteDance, operator of TikTok, which was known to have serious security risks and was under intense scrutiny by U.S. officials; (2) that there was a material risk that Fastly’s business would be adversely impacted should any adverse actions be taken against ByteDance or TikTok by the U.S. government; and (3) that, as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
Specifically, on August 5, 2020, after market close, the Company hosted an earnings call for its Q2 2020 results. On the call, Company CEO Joshua Bixby revealed for the first time that “ByteDance, the operator of TikTok[,] was our largest customer in the quarter.” Bixby also suggested on the call that ByteDance was a significant customer in Q1 as well, stating that “over the last six months, [TikTok] represents just about 12% of revenue, trailing 6 months ending June 30.”
On this news, Fastly’s stock fell from a closing price of $108.92 per share on August 5, 2020 to $89.64 per share on August 6, 2020—a $19.28 or 17.70% drop.
That same day, August 6, 2020, President Trump issued an executive order that would take effect in 45 days and prohibit any U.S. company or person from transacting with ByteDance, TikTok’s Chinese parent company.
On this news, Fastly’s shares continued to decline, dropping another $10.31 per share from the closing price on August 6, 2020, or approximately 11.5%, to close at $79.33 on August 7, 2020.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Fastly’s conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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