BENSALEM, Pa.--(BUSINESS WIRE)--Law Offices of Howard G. Smith announces that a class action lawsuit has been filed on behalf of investors who purchased Chegg, Inc. (“Chegg” or the “Company”) (NYSE: CHGG) common stock between May 5, 2020 and November 1, 2021, inclusive (the “Class Period”). Chegg investors have until February 22, 2022 to file a lead plaintiff motion.
Investors suffering losses on their Chegg investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in this class action at 888-638-4847 or by email to howardsmith@howardsmithlaw.com.
On November 1, 2021, Chegg released its financial results for the first quarter in which students had returned to campuses after an extended period of remote education due to the COVID-19 pandemic. Chegg announced fewer-than-expected enrollments and did not provide fiscal 2022 guidance. Chegg’s CEO and president admitted to being aware of the slowdown in September 2021.
On this news, Chegg’s stock price fell $30.64, or 48.8%, to close at $32.12 per share on November 2, 2021, thereby injuring investors.
The complaint filed in this class action 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) Chegg's increase in subscribers, growth, and revenue had been a temporary effect of the COVID-19 pandemic that resulted in remote education for the vast majority of United States students and once the pandemic-related restrictions eased and students returned to campuses nationwide, Chegg's extraordinary growth trends would end; (2) Chegg's subscriber and revenue growth were largely due to the facilitation of remote education cheating – an unstable business proposition – rather than the strength of its business model or the acumen of its senior executives and directors; and (3) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
If you purchased Chegg common stock, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020, by telephone at (215) 638-4847, toll-free at (888) 638-4847, or by email to howardsmith@howardsmithlaw.com, or visit our website at www.howardsmithlaw.com.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.