It is safe to say that the last year has not been smooth streaming for Netflix. The media giant has made the news for all the wrong reasons, facing criticisms from unhappy subscribers to co-star with some less than stand up business practices. But the latest episode in what seems like a never ending saga comes in the form of a legal drama, with Netflix’s own shareholders suing the company for misleading them over the extent of recent subscriber losses. In short, Netflix is suing itself.
The lawsuit is seeking class action status for investors who owned Netflix stock between October 2021 and April 2022, and alleges that Netflix “employed devices, schemes and artifices to defraud investors.” Essentially, they lied about their subscriber numbers. This apparent deception resulted in Netflix’s stock dipping 35 percent, and $54 billion in one day after the extent of their subscriber losses was reported, and has continued to lose over $200 billion in total market value. Over the time frame covered by the lawsuit, Netflix shares have decreased 67% from $692 per share, to $226 per share.
Suing themselves is just the latest casting in an ensemble of recent incidents for Netflix, as they continue to find themselves under critique for adding advertisements, cracking down on password sharing, and laying off significant numbers of employees. Perhaps the most egregious example of the latter came in the form of Netflix scrapping its new TUDUM project, firing masses of employees mere months after poaching them from other companies on promises of high salaries and unmatched opportunity. Many of those employees had been coerced away from long held jobs, and some even relocated, only to find themselves unemployed a few months later.
It’s beginning to look like Netflix’s finale will resemble that of Game of Thrones, but HBO along with other new growing streaming services might have the last laugh. All we know is that if they don’t turn themselves around soon, it might be the end of Netflix as we know it, canceled after this season, and with no hope of a re-boot.