Stride Leadership Sued Over ‘Ghost Students,’ Staffing Issues

Stride Inc.'s board and top executives misrepresented the online educator’s business health by concealing false enrollment numbers, corner-cutting in staffing and background checks, and sales slippage, an investor alleges.

The harm to the company from its leaders’ misconduct includes the costs of its exposure to a proposed investor class action, corporate reform expenses, and damage to its reputation, David Murphy says. He filed his derivative suit Monday in the US District Court for the Eastern District of Virginia.

The class action focused on the Oct. 29 stock drop of 54%, to close at $70.05 per share, following a disappointing financial ...