Robinhood Takes Its Fight to Defeat IPO Suit to Supreme Court

Robinhood Markets Inc. shouldn’t have to continue defending itself in an investor suit over its initial public offering, the trading platform company told the US Supreme Court.

The US Court of Appeals for the Ninth Circuit widened a circuit split on the standards for suing over disclosures in IPO registration and prospectus documents, Robinhood and its underwriters said in their petition asking the justices to resolve the schism.

The request comes as IPO activity has heated up and is expected to continue strong in 2026.

The Ninth Circuit panel’s 2–1 majority said in August that changes in Robinhood’s financial metrics merely needed to be “material” to prompt updated disclosures in registration and prospectus documents filed before the IPO. The ruling reinstated a proposed class action alleging nondisclosure of trading trends following the meme stock craze of early 2021.

The appeals court rejected a First Circuit standard requiring intra-quarter disclosures from companies headed toward IPOs only when there’s been an “extreme departure” from historical results.

Robinhood and the underwriters argued in their petition, filed with the high court Feb. 5 but not immediately released, that the high court should clarify whether the “extreme departure” test applies.

Further, the companies said, most courts of appeals have treated the requirement to show an omission’s materiality as distinct from the requirement to show the omission rendered a prior statement misleading. The alleged omissions didn’t make “any statement in Robinhood’s offering documents misleading,” particularly in light of Robinhood’s warnings—including one about a likely future decline in key metrics, the petitioners said.

The full Ninth Circuit declined to rehear the case.

Sullivan & Cromwell LLP and Cravath, Swaine & Moore LLP represent Robinhood. Orrick, Herrington & Sutcliffe LLP represents the underwriters.

The case is Robinhood Markets, Inc. v. Sodha, U.S., No. 25-944, petition for certiorari 2/5/26.