Twitter, Inc.

On August 23, 2022, CNN published an article alleging, among other things, that “Twitter has major security problems that pose a threat to its own users' personal information, to company shareholders, to national security, and to democracy, according to an explosive whistleblower disclosure obtained exclusively by CNN and The Washington Post.” The article also stated that the whistleblower disclosure “also alleges that some of the company’s senior-most executives have been trying to cover up Twitter's serious vulnerabilities, and that one or more current employees may be working for a foreign intelligence service.”

On this news, Twitter’s stock fell $3.15, or 7.3%, to close at $39.86 per share on August 23, 2022, thereby injuring investors.

The complaint filed alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors that: (1) Twitter knew about security concerns on their platform; (2) Twitter actively worked to hide the security concerns from the board, the investing public, and regulators; (3) contrary to representations in SEC filings, Twitter did not take steps to improve security; (4) Twitter’s active refusal to address security issues increased the risk of loss of public goodwill; and (5) as a result, Defendants' statements about its business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.