RADNOR, Pa., May 15, 2021 /PRNewswire/ — The law firm of Kessler Topaz Meltzer & Check, LLP announces that a securities fraud class action lawsuit has been filed in the United States District Court for the Northern District of California against Skillz Inc. (NYSE: SKLZ) («Skillz») f/k/a Flying Eagle Acquisition Corp. («FEAC») on behalf of those who purchased or acquired Skillz securities between December 16, 2020 and April 19, 2021, inclusive (the «Class Period»).
Investor Deadline Reminder: Investors who purchased or acquired Skillz securities during the Class Period may, no later than July 7, 2021, seek to be appointed as a lead plaintiff representative of the class. For additional information or to learn how to participate in this litigation please contact Kessler Topaz Meltzer & Check, LLP: James Maro, Esq. (484) 270-1453 or Adrienne Bell, Esq. (484) 270-1435; toll free at (844) 887-9500; via e-mail at email@example.com; or click https://www.ktmc.com/skillz-class-action-lawsuit?utm_source=PR&utm_medium=link&utm_campaign=skillz
Skillz is an internet tech company that provides a proprietary gaming platform for mobile gaming users and developers. FEAC was formed as a special purpose acquisition company in early January 2020 by its sponsor Eagle Equity Partners II, LLC, led and controlled by defendant, Harry Sloan, a member of Skillz’s Board of Directors and former President and Chairman of FEAC. Within eight months, FEAC and Mr. Sloan had secured $158 million in private placement commitments in connection with a business combination between FEAC and its target – Skillz. After a definitive merger agreement and subscription agreements were executed, on September 8, 2020, FEAC, through its Board of Directors, filed a merger proxy statement and prospectus on a Registration Form S-4.
The Class Period commences on December 16, 2020, when Skillz issued a press release, which was attached to Skillz’s Form 8-K filed on December 17, 2020, entitled «SKILLZ BECOMES FIRST PUBLICLY TRADED MOBILE ESPORTS PLATFORM.» Throughout the Class Period, Skillz touted its business prospects.
However, on March 8, 2021, a research report by Wolfpack Research titled «SKLZ: It Takes Little Skill to see this SPACtacular Disaster Coming» was publicly released which described, among other things, how: (1) third-party app data shows installations of the three games responsible for 88% of Skillz’s revenues (21 Blitz, Solitaire Cube, and Blackout Bingo) all declined substantially; (2) Skillz did not disclose the substantial decrease in the popularity of these three games (despite their material importance to its growth trajectory); (3) Skillz is not taken seriously by gaming industry players; (4) Skillz has a long history of boasting about «big partnerships» which have amounted to nothing of value; and (5) Andrew Paradise, co-founder of Skillz and its Chief Executive Officer, does not have the relevant experience that had been expressed. Following this news, shares of Skillz fell by 10.9% to close at $24.45. This disclosure represented approximately $762 million loss of investor value.
Then, on April 19, 2021, an anonymous Twitter account named Eagle Eye Research, released a short seller report. The report stated, «[Skillz] has never turned a profit and we doubt it ever will.» The Eagle Eye Report alleged that Skillz was «recognizing revenue from ‘virtual’ money it gave its customers to spend although no real cash is generated in the process.» Following this news, shares of Skillz fell by 6.61% to close at $12.55 on April 19, 2021, losing approximately $254 million in investor value.
The complaint alleges that throughout the Class Period, the defendants disseminated false and misleading statements and omissions that materially misrepresented Skillz’s purported financial condition and prospects. These materially misleading statements and omissions included representations relating to certain of Skillz’s business operations, performance metrics and ultimate valuation, including, among others, Skillz’s ability to attract new end-users, future profitability, the shrinking popularity of its hosted games that accounted for 88% of its revenue, and Skillz’s valuation.
Skillz investors may, no later than July 7, 2021, seek to be appointed as a lead plaintiff representative of the class through Kessler Topaz Meltzer & Check, LLP or other counsel, or may choose to do nothing and remain an absent class member. A lead plaintiff is a representative party who acts on behalf of all class members in directing the litigation. In order to be appointed as a lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not affected by the decision of whether or not to serve as a lead plaintiff.
Kessler Topaz Meltzer & Check, LLP prosecutes class actions in state and federal courts throughout the country involving securities fraud, breaches of fiduciary duties and other violations of state and federal law. Kessler Topaz Meltzer & Check, LLP is a driving force behind corporate governance reform, and has recovered billions of dollars on behalf of institutional and individual investors from the United States and around the world. The firm represents investors, consumers and whistleblowers (private citizens who report fraudulent practices against the government and share in the recovery of government dollars). The complaint in this action was not filed by Kessler Topaz Meltzer & Check, LLP. For more information about Kessler Topaz Meltzer & Check, LLP please visit www.ktmc.com.
Kessler Topaz Meltzer & Check, LLP
James Maro, Jr., Esq.
Adrienne Bell, Esq.
280 King of Prussia Road
Radnor, PA 19087
(844) 887-9500 (toll free)
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SOURCE Kessler Topaz Meltzer & Check, LLP