Investors who claim they were deceived when Snapchat went public last year will get a chance to pursue damages in court.
Snap Inc., the maker of an application for ephemeral messages and videos, lost its bid to dismiss a securities lawsuit stemming from its initial public offering in March 2017. The next step for shareholders is to request class-action status, which would give them additional leverage to negotiate a settlement.
The investors allege that prior to the IPO, Snap didn’t reveal how much competition from Instagram, the photo-sharing app, was hurting its growth in the second half of 2016. They ...