Skillz investors may receive additional information about the case by clicking the link "Submit Your Information" above. If you are a member of the class described above, you may no later than July 7, 2021 move the Court to serve as lead plaintiff of the class, if you so choose.
Skillz is an internet tech company that provides a proprietary gaming platform for mobile gaming users and developers. FEAC was formed as a special purpose acquisition company in early January 2020 by its sponsor Eagle Equity Partners II, LLC, led and controlled by defendant, Harry Sloan, a member of Skillz’s Board of Directors and former President and Chairman of FEAC. Within eight months, FEAC and Mr. Sloan had secured $158 million in private placement commitments in connection with a business combination between FEAC and its target – Skillz. After a definitive merger agreement and subscription agreements were executed, on September 8, 2020, FEAC, through its Board of Directors, filed a merger proxy statement and prospectus on a Registration Form S-4.
The Class Period commences on December 16, 2020, when Skillz issued a press release, which was attached to Skillz’s Form 8-K filed on December 17, 2020, entitled “SKILLZ BECOMES FIRST PUBLICLY TRADED MOBILE ESPORTS PLATFORM.” Throughout the Class Period, Skillz touted its business prospects.
However, on March 8, 2021, a research report by Wolfpack Research titled “SKLZ: It Takes Little Skill to see this SPACtacular Disaster Coming” was publicly released which described, among other things, how: (1) third-party app data shows installations of the three games responsible for 88% of Skillz’s revenues (21 Blitz, Solitaire Cube, and Blackout Bingo) all declined substantially; (2) Skillz did not disclose the substantial decrease in the popularity of these three games (despite their material importance to its growth trajectory); (3) Skillz is not taken seriously by gaming industry players; (4) Skillz has a long history of boasting about “big partnerships” which have amounted to nothing of value; and (5) Andrew Paradise, co-founder of Skillz and its Chief Executive Officer, does not have the relevant experience that had been expressed. Following this news, shares of Skillz fell by 10.9% to close at $24.45. This disclosure represented approximately $762 million loss of investor value.
Then, on April 19, 2021, an anonymous Twitter account named Eagle Eye Research, released a short seller report. The report stated, “[Skillz] has never turned a profit and we doubt it ever will.” The Eagle Eye Report alleged that Skillz was “recognizing revenue from ‘virtual’ money it gave its customers to spend although no real cash is generated in the process.” Following this news, shares of Skillz fell by 6.61% to close at $12.55 on April 19, 2021, losing approximately $254 million in investor value.
The complaint alleges that throughout the Class Period, the defendants disseminated false and misleading statements and omissions that materially misrepresented Skillz’s purported financial condition and prospects. These materially misleading statements and omissions included representations relating to certain of Skillz’s business operations, performance metrics and ultimate valuation, including, among others, Skillz’s ability to attract new end-users, future profitability, the shrinking popularity of its hosted games that accounted for 88% of its revenue, and Skillz’s valuation.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Filling out the online form above or communicating with any counsel is not necessary to participate or share in any recovery achieved in this case. Any member of the purported class may move the court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.
If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Kessler Topaz Meltzer & Check, LLP: James Maro, Esq. (484) 270-1453 or Adrienne Bell, Esq. (484) 270-1435; toll-free at (844) 887-9500; or via e-mail at email@example.com. If you would like additional information about the suit, please click on the link "Submit Your Information" above and fill out the form as promptly as possible.