Securities Litigation Partner James (Josh) Wilson Encourages Investors Who Have Suffered Losses Exceeding $100,000 In Opendoor to contact them directly to discuss their options
NEW YORK, December 4, 2022 /PRNewswire/ — Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential claims against Opendoor Technologies, Inc. (“Opendoor” or the “Company”) (NASDAQ : OPEN) and reminds investors of the December 6, 2022 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
If you have incurred losses exceeding $100,000 invest in (a) Opendoor securities between December 21, 2020 and September 16, 2022, both dates inclusive (the “Class Period”); and/or (b) Opendoor Common Stock pursuant to and/or traceable to the Offering Documents (defined below) issued in connection with the business combination between the Company and Opendoor Labs Inc. (“Legacy Opendoor”) completed on or around December 18, 2020 (fusion”) and want to discuss your legal rights, call partner Faruqi & Faruqi Josh Wilson directly at 877-247-4292 Where 212-983-9330 (ext. 1310). You can also click here for more information: www.faruqilaw.com/OPEN.
There is no cost or obligation for you.
Faruqi & Faruqi is a leading national minority and women-owned securities law firm, with offices in New York, Pennsylvania, California and Georgia.
Opendoor was formerly known as Social Capital Hedosophia Holdings Corp. II (“SCH”) and operated as a special purpose acquisition company, also known as a blank check company, which is a development-stage company that does not have a specific business plan or objective or who has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies, other entity or person.
On September 15, 2020the Company, then still operating as SCH, and Legacy Opendoor, a private company operating as a digital platform for residential real estate, announced that they had entered into a definitive agreement for the Merger (the “Merger Agreement “), which valued Legacy Opendoor at an enterprise value of $4.8 billion.
On October 5, 2020the Company has filed a registration statement on Form S-4 with the United States Securities and Exchange Commission (“SEC”) in connection with the Merger, which, after several amendments, has been declared effective by the SEC the November 27, 2020 (the “Registration Statement”). On November 30, 2020the Company has filed a proxy statement/prospectus on Form 424B3 with the SEC in connection with the Merger, which formed part of the Registration Statement (the “Proxy” and, together with the Registration Statement, the “Offering Documents”).
On December 18, 2020pursuant to the merger agreement, the company has, among other things, deregistered as Cayman Islands company, registered as Delaware company, changed its name to “Opendoor Technologies Inc.”, and completed the merger, whereby, among other things, Legacy Opendoor became a wholly owned subsidiary of the company.
Following the merger, the company operated a digital platform for buying and selling residential real estate in the United States. The company’s platform uses a technology known as “iBuying,” which is an algorithm-based process that allegedly enables Opendoor to provide accurate market-based information. offers to sellers for their homes, then returns those homes to buyers for a profit.
As detailed below, the lawsuit focuses on whether the Company and its officers violated federal securities laws by making false and/or misleading statements and/or failing to disclose that: (1 ) the algorithm (“Algorithm”) used by the Company to make housing offers could not accurately adapt to changes in housing prices under different market conditions and economic cycles; (2) as a result, the Company was at increased risk of sustaining significant and repeated losses due to fluctuations in residential real estate prices; (3) as a result, defendants exaggerated the algorithm’s purported advantages and competitive advantages; and (4) as a result, the Defendants’ offering documents and public statements throughout the Class Period were materially false and/or misleading and did not contain the information that should be contained therein.
On September 19, 2022citing a review of industry data, Bloomberg reported that the company appeared to have lost money on 42% of its trades in August 2022 (as measured by the prices at which he bought and sold properties). Bloomberg further reported that the data was even worse in key markets such as Los Angeles, Californiawhere Opendoor lost money on 55% of sales, and Phoenix, Arizona, where it lost money on 76% of sales. Worse still, a global real estate technology strategist interviewed by Bloomberg, Mike Del Prete, predicted that, based on his analytics, September would likely be even worse for Opendoor than August. Bloomberg’s findings highlighted the failure of Opendoor’s algorithm to accurately adapt to changing market conditions.
Following the Bloomberg report, Opendoor’s share price fell $0.50 per share, i.e. 12.32%, over the next two trading sessions, to close at $3.56 per share on September 202022 – an 88.61% decline from the company’s first closing share price after the merger of $31.25 per share on December 21, 2020 (the “Initial Closing Price”).
At the time this complaint was filed, Opendoor common stock was trading significantly below the original closing price and continues to trade below its original merger value, hurting investors.
The court-appointed lead plaintiff is the investor with the greatest financial interest in the relief sought by the class that is adequate and typical of the class members directing and supervising the litigation on behalf of the putative class. Any putative class member may ask the Court to serve as lead plaintiff through counsel of their choosing, or may choose to do nothing and remain an absent class member. Your ability to participate in any collection is not affected by whether or not to serve as lead plaintiff.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Opendoor’s conduct to contact the company, including whistleblowers, former employees, shareholders and others.
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