Netflix Inc. has been hit with a shareholder lawsuit in a U.S. court in California accusing the streaming entertainment company of misleading the market about its ability to keep adding subscribers in recent months.
The lawsuit filed in San Francisco federal court on Tuesday seeks damages for declines in Netflix’s share price this year after the company missed its subscriber growth estimates.
Filed by a Texas-based investment trust, the lawsuit accused Los Gatos, California-based Netflix and its top executives of failing to disclose that its growth was slowing amid increased competition and that it was losing subscribers on a net basis.
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