tl;dr
An international law firm, Pomerantz LLP, has filed a class action lawsuit against Strategy (formerly MicroStrategy) and its founder Michael Saylor. The lawsuit alleges that Strategy made materially false and misleading statements about its profitability by omitting critical information from its dis...
Pomerantz LLP has initiated a class action lawsuit against Strategy, formerly known as MicroStrategy, and its founder Michael Saylor. The suit alleges that between April 30, 2024, and April 4, 2025, the company made false and misleading statements about its bitcoin profitability by omitting critical information in its public disclosures.
The complaint asserts that Strategy overstated its expected profitability while understating the risks linked to bitcoin’s volatility and potential financial losses under the new accounting standard ASU 2023-08. This resulted in materially false statements that misled investors regarding the company’s true financial outlook.
Earlier this year, Strategy reported a $5.91 billion unrealized loss after adopting updated accounting methods, a significant shift from prior practices. Following this SEC disclosure, the company cautioned investors that future profitability was uncertain and might not be recovered. Despite these warnings, Strategy continues to hold a substantial bitcoin treasury of 568,840 BTC, valued at over $59.8 billion, and made another large bitcoin purchase on the day the lawsuit was filed.
The lawsuit represents anyone who acquired Strategy securities during the class period and challenges the reliability of public statements related to the company’s bitcoin-focused investment strategy, operational risks, and financial prospects.