U.S. District Judge Jon Tigar in San Francisco dismissed a shareholder lawsuit accusing Netflix (NFLX) of downplaying the impact of subscriber growth of account sharing, where paying users share user names and passwords with nonpaying members in other homes, Reuters’ Jonathan Stempel reports. The proposed class action started after the company revealed in April 2022 that it had lost 200,000 subscribers in the prior quarter and could lose 2M more in the following three months, the author says, noting that the company blamed the decline on a number of factors, including account sharing. Judge Tigar, however, said Netflix’s prior claims about being “roughly 60% penetrated” in the U.S. and Canada with “a lot of headroom” to grow were not false or misleading, since they referred to paid subscribers and did not imply that growth was a certainty, the author notes.
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