A lawsuit was filed by a current investor in shares of Angie’s List Inc (NASDAQ:ANGI) over possible breaches of fiduciary duty by certain officers and directors and NASDAQ:ANGI stockholders should contact the Shareholders Foundation at email@example.com
San Diego, CA -- (SBWIRE) -- 11/12/2014 -- A current long-term investors in shares of Angie’s List Inc (NASDAQ:ANGI) filed a lawsuit against directors of Angie’s List over alleged wrongdoing. The plaintiff alleges that the company secretly changed its business model of consumer-driven reviews to one that charged businesses for favorable reviews.
Investors who are current long term stockholders in Angie’s List Inc (NASDAQ:ANGI) shares, have certain options and should contact the Shareholders Foundation at firstname.lastname@example.org or call +1(858) 779 - 1554.
The plaintiff says that while Angie’s List has repeatedly claimed that Angie’s List vetted companies before adding them to Angie's List, repeatedly referring to itself as a 'consumer-driven organization,' and suggested that businesses have no say in the reviews on Angie's List in reality all of the those representations were misleading.
The lawsuit against directors over alleged breaches of fiduciary duties follows a lawsuit filed against Angie’s List Inc over alleged Violations of Federal Securities Laws filed in the U.S. District Court for Southern District of Indiana. According to that complaint the plaintiff alleges that Angie's List Inc. violated the Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. More specifically, the plaintiff alleges that defendants between February 14, 2013 and October 23, 2013, issued allegedly materially false and misleading statements regarding the strength of the Company's business model and its financial performance and future prospects and failed to disclose, that Angie's List had increased its reliance on providing free memberships in order to artificially boost its subscriber figures, that contrary to Angie's List's repeated between February 14, 2013 and October 23, 2013 statements that the online reviews were unbiased because Angie's List did not permit service providers to buy ratings on its website ("You can't pay to be on Angie's List"), the Company was consistently deriving more than half of its revenues from the service provider side of its business - where it relied heavily on collecting fees for listing paid service providers more prominently, that because Angie's List sometimes charged service providers hundreds of dollars for "hot leads," those costs were being passed along to Angie's List subscribers, increasing the prices consumers were paying and decreasing the benefit to them of using the website, that the legitimacy of the service provider side of Angie's List's business model was called into question by Angie's List's practice of forcing service providers to pay high fees to be listed as highly rated service providers, knowing that if they did not, they would not get customer referrals from Angie's List, that because Angie's List did not vet the service providers listed and recommended on its website, either for qualifications or for safety, many consumers were questioning the value of its recommendations, making them unwilling to continue paying outsized membership fees, and,- that as a result of the foregoing, defendants lacked a reasonable basis for their positive statements about the strength of Angie's List's business model and its business and financial prospects between February 14, 2013 and October 23, 2013.
On September 30, 2013, Angie's List Inc disclosed in a filing with the SEC that its Chief Technology Officer Manu Thapar’s employment with the Company has ended effective September 27, 2013. Then on October 23, 2013, Angie's List Inc reported its third quarter 2013 results. Shares of Angie's List Inc declined from $28 per share in July 2013 to as low as $6.37 per share on September 30, 2014.
On November 10, 2014, NASDAQ: ANGI shares closed at $6.52 per share.
Those who purchased shares of Angie's List Inc have certain options and should contact the Shareholders Foundation.
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