Sign in Subscribe
Class action lawsuits

Reddit Investors Sue Over Alleged Securities Fraud

Strategic Insights

— 1 min read

A class-action lawsuit has been filed on behalf of investors in Reddit, Inc. alleging that the company made false statements and concealed information about its user rates and advertising revenues. The lawsuit claims that changes in Google Search's algorithm and features, such as AI Overview, caused users to stop their query on Google Search, reducing traffic to the Reddit website. This allegedly reduced user rates and advertising revenues, making the company's public statements misleading.

Key Takeaways:

  • The lawsuit alleges that Reddit made false statements and concealed information about its user rates and advertising revenues between October 29, 2024, and May 20, 2025.
  • The complaint alleges that defendants were aware that the increase in the query term "Reddit" on search engines was because users were getting the sought-after answer from Google Search without intending to visit Reddit.
  • The lawsuit claims that the changes in Google Search's algorithm and features caused users to stop their query on Google Search, reducing traffic to the Reddit website.
  • The alleged securities fraud resulted in losses for investors in Reddit, Inc.
  • The lawsuit seeks to recover these losses on behalf of affected investors.
  • Levi & Korsinsky, LLP, a law firm with expertise in securities litigation, is representing investors in this case.
  • The firm has secured hundreds of millions of dollars for aggrieved shareholders in the past 20 years.

Statistics:

  • The lawsuit covers a period from October 29, 2024, to May 20, 2025.
  • The class action seeks to recover losses on behalf of investors in Reddit, Inc. during this time frame.
  • The deadline to request that the Court appoint a lead plaintiff is August 18, 2025.
  • There are over 70 employees at Levi & Korsinsky, LLP, serving their clients.
  • The firm has ranked in ISS Securities Class Action Services' Top 50 Report as one of the top securities litigation firms in the United States for seven consecutive years.

Sources:

  • GlobeNewswire, "Levi & Korsinsky, LLP Notifies Investors in Reddit, Inc. of Class Action Securities Lawsuit"

Read more