Bumble, Inc. and affiliated defendants filed a motion to dismiss the securities suit filed against them. They primarily argue that the contested statements constitute “non-actionable puffery.”
As has been previously covered on Law Street, this case concerns whether Bumble, a dating app, misled the public in its secondary public offering (SPO). The case further implicates investment fund Blackstone, which has a a controlling interest in the company, as well as the roughly two dozen firms who underwrote the SPO.
In the motion, Bumble argues that the statements the complaint alleges as false were simple optimistic projections. For example, the lead plaintiff, the Louisiana Sheriffs’ Pension and Relief Fund, argues the following statement as misleadingly optimistic. “As our community continues to grow, user engagement and monetization increase. These increases enable us to reinvest in product innovation and marketing and, in turn, attract more people to our platform.” Bumble counters that the statement is too broad to be construed as a material statement.
They go on to detail that the SPO did contain, they believe, adequate warning as to potential risks and how they could affect their profits. While the pension fund argues these warnings were merely stated as hypotheticals, Bumble says they do indeed constitute fair warning.
And finally, Bumble feels the Southern District of New York should dismiss charges against specifically the Blackstone defendants on the grounds that their affiliation is not specifically alleged. They posit that surely not all of those individuals had power over Bumble, so they cannot be held liable for the alleged fraud.