Netflix Board Sued for Ignoring ‘Red Flags’ on Subscriber Loss

Streaming giant Netflix’s board misrepresented the company’s business outlook by “blaming any slowing in subscriber growth on the pandemic,” according to a new shareholder suit in a California federal court.

The board breached its fiduciary duties and committed securities law violations, “irreparably” harming the company’s reputation, according to the shareholder derivative action brought Thursday in the U.S. District Court for the Northern District of California.

The lawsuit, brought by investor Mindy Lehmann, said the board “ignored red flags from the news media and financial analysts warnings of Netflix’s shrinking share of the streaming market, due to new competitors, account-sharing issues, ...