Twitter said on Monday that it will pay $809.5 million to settle a consolidated class-action lawsuit. As alleged by the investors, Twitter misled its investors about how much its user base was growing and how much users interacted with its platform.
However, the proposed settlement which must still be signed off by a judge resolves all claims against it without Twitter admitting any wrongdoing.
The original lawsuit was filed in 2016 by Twitter investor Doris Shenwick who claims that in 2014 Twitter executives said that the site’s monthly average user base was expected to increase significantly to “to over 550 million” in the intermediate-term and “over a billion” over the longer term.
Shenwick also claimed that Twitter executives “knowingly made inaccurate public statements regarding these metrics, and failed to disclose internal information about them, resulting in an inflated share price that fell when the truth about user engagement became known”, as quoted by The Indian Express.
However, in 2019, Twitter stopped reporting monthly user figures and in its last count of the monthly user, figures were at 330 million. Now, Twitter reports only daily user figures. Earlier to this, in 2017, Twitter acknowledged its mistake that it had been overstating its monthly user numbers since it was including users of a third-party app which it should not have included.