On April 27, 2023, Judge Charles R. Breyer of the United States District Court for the Northern District of California granted a motion to dismiss a proposed securities class action suit against a financial technology company (the “Company”) and four executives, including its CEO and CFO, alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 10b-5(b). Huei-Ting Kang v. PayPal Holdings Inc., No. 3:21-cv-06468 (N.D. Cal. Apr. 27, 2023). The Court dismissed the complaint with prejudice for failure to plead falsity and failure to plead a strong inference of scienter. The Court had previously dismissed plaintiffs’ prior complaint without prejudice, in a decision covered here.
Plaintiffs alleged that the Company, which offers products and services for consumers and merchants to send and receive digital payments, misled investors about its compliance with regulatory obligations, including its compliance with a consent order (the “Consent Order”) entered into with the Consumer Financial Protection Bureau (the “CFPB”) in 2015. According to plaintiffs, the Consent Order, which resolved claims that the Company enrolled students at for-profit colleges in the Company’s credit product without their knowledge, prohibited the Company from enrolling customers in its credit product without their affirmative consent. Plaintiffs alleged that the Company made false statements about its compliance with the Consent Order such as statements that the...
On July 16, 2026, the New Jersey Supreme Court held that the New Jersey False Claims Act’s (NJFCA) 2023 “Opposition Amendment”—which streamlined the state attorney general’s ability to oppose dism...