Webtoon Entertainment (WBTN) Financial Misrepresentation Case

C.D. California

Court

2:24-cv-07553

Case number

27 Jun 2024

Class period Start

05 Sept 2024

Class period End

04 Nov 2024

Lead Plaintiff motion deadline

$WBTN stockholder filed a claim against Webtoon Entertainment for misleading investors about the company’s revenue growth and financial health. 
On August 9, 2024, news about Webtoon’s financial results caused $WBTN to fall 38.2%.
Webtoon investors can join this case to be notified about potential recovery.
Case Details: 

On August 8, 2024, Webtoon announced its financial results for Q2 2024.
Webtoon reported total revenue growth of only 0.1% and revealed significant declines in key segments, including a 3.6% drop in advertising revenue and a 3.7% drop in IP adaptations revenue.
The company also reported a net loss of $76.6 million and attributed “weaker than expected” results to exposure to foreign currency fluctuations, particularly the Korean won and Japanese yen.
During the earnings call, Webtoon’s leadership acknowledged that the company faced challenges in maintaining revenue growth.
They pointed to weaker advertising performance and difficulties in the IP adaptations segment as major factors in the disappointing financial results.
On this news, $WBTN fell 38.2% on August 9, 2024.

Based on these events, $WBTN stockholder filed a claim against Webtoon and its leaders, accusing them of the following:
Webtoon overstated its financial health, including future revenue potential from advertising and IP adaptations.
The company failed to disclose the full impact of foreign currency risks and declining revenue streams, which significantly affected investor expectations.
Considering all the representations, investors have reason to suspect that Webtoon misrepresented its financial health, leading to substantial losses after the IPO.

One of Webtoon’s investors has already filed a claim against Webtoon in the C.D. California court.

Case Status

Lead Plaintiff Submission

Alleged Offence

Misleading Statements,

Financial Misrepresentation,

Failure to Disclose,

Negligence

Suspected Party

Directors,

Management,

Investment Bank

Security Type

Stocks

Trade Direction

Long

Shock Event Date

09 August 2024

Filing date

05 September 2024

Lead Plaintiff Deadline

04 November 2024

Judge

Consuelo B. Marshall

Webtoon Entertainment (WBTN) Financial Misrepresentation Case

Collecting participants…