A class-action lawsuit was filed Thursday against the stock-trading app Robinhood for preventing its users from freely buying stock in GameStop amid the ongoing situation with the declining video game retailer and its dramatically changing stock price.
The complaint—filed in the U.S. District Court of the Southern District of New York—claims that, because “Robinhood purposefully, willfully, and knowingly removing the stock ‘GME’ [GameStop] from its trading platform in the midst of an unprecedented stock rise,” the online brokerage firm “thereby deprived retail investors of the ability to invest in the open-market and manipulating the open-market.”
As part of the lawsuit, the plaintiffs are requesting an immediate injunction mandating Robinhood to reinstate GME on its trading platform.
At the time of publication, Robinhood has not issued a statement about the lawsuit.
MORE ON ROBINHOOD, GAMESTOP: ‘You almost had me murdered’: AOC doesn’t want Cruz to join bipartisan push to investigate Robinhood
Earlier on Thursday, Robinhood prevented users from purchasing new stock in GameStop, AMC, and Blackberry but has allowed users to close out existing securities.
“In light of current market volatility, we are restricting transactions for certain securities to position closing only, including $AMC and $GME,” the company tweeted Thursday, with a link to a statement. While the tweet at the time of publication has a little of 6,000 likes, that number is astronomically dwarfed by the 58,000 comments and the roughly 25,000 retweets.
Earlier this week, other trading platforms like TD Ameritrade and Charles Schwab restricted the trading of shares such as GameStop and AMC, which has also been struggling to stay afloat amid shifts in the film industry toward streaming services.
To briefly explain the situation, GameStop’s stock price has shot up dramatically over the course of more than a week due to users on the Reddit community r/WallStreetBets encouraging other individual investors on the subreddit to purchase stock in the fledgling video game vendor through equities and calls.
Notably, politicians on both extremes of the ideological spectrum have come out in support of Congress looking into Robinhood restricting trading for its users, saying that it’s hypocritical that hedge funds can still trade as they wish, such as Rep. Alexandria Ocasio-Cortez (D-N.Y.) and Sen. Ted Cruz (R-TX).
You can follow Douglas Braff on Twitter @Douglas_P_Braff.
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Biden spends $1.65 trillion taxpayer dollars while vacationing in St. Croix
While vacationing in the island of St. Croix for the holidays, President Joe Biden on Thursday signed into law the massive $1.65 omnibus spending package.
The whopping 4,155 pages was supported by only nine House Republicans and 13 Senate Republicans. Majority of criticism from the GOP includes concerns that the bill was rushed and crammed with wasteful spending by a lame-duck Democratic-dominated Congress. The recourse will punish American families by adding to the national debt and exacerbate inflation.
“Today, I signed the bipartisan omnibus bill, ending a year of historic progress. It’ll invest in medical research, safety, veteran health care, disaster recovery, VAWA funding — and gets crucial assistance to Ukraine,” Biden tweeted. “Looking forward to more in 2023.”
Senate minority leader Mitch McConnell “praised the bill on the grounds that it represents a real decrease in discretionary spending. He presented it as a positive that nondefense spending jumped by only 5.5 percent, from $730 billion to $772.5 billion, amid an inflation rate of 7.1 percent” writes National Review.
“The bipartisan government-funding bill that Senators Shelby and Leahy have finished negotiating does exactly the opposite of what the Biden administration first proposed,” he said. “This bill provides a substantial real-dollar increase to the defense baseline . . . and a substantial real-dollar cut to the non-defense, non-veterans baseline,” McConnell insisted as negotiations were wrapping up.
House minority leader Kevin McCarthy, however, stated his strong disapproval of the bill before it even advanced. Affirming a letter from 13 House Republicans, McCarthy demanded the bill is reckless, irresponsible, and a “purposeful refusal to secure and defend our borders.”
For example, it failed to incorporate protections for Title 42, the pandemic policy that allows illegal immigrants to be expelled on a public-health basis, which currently hangs in the balance at the Supreme Court.
National Review adds, “The funding in the bill, which averted a federal government shutdown before the new year, includes an allocation of $45 billion in defense assistance to Ukraine. Some Republican priorities, such as Electoral Count Act reform and a bigger military budget, were nested in with Democratic appropriations, such as increased funding for Medicaid and food stamps.”
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