Attorneys representing a proposed class of users of the Robinhood app amended their complaint Friday slinging arrows at the stock trading app for allegedly luring young and unsophisticated traders with its clever design and interface, but never equipping them with information on how to access their accounts during its several service interruptions, Law360 reports. The app was down almost an entire day in March during which the Dow Jones Industrial Average logged its largest single-day point gain in Dow history up to that time.
The lawsuit was originally filed on March 4, two days after the Robinhood app experienced an outage and locked people out of their accounts. Since then, the app has experienced more than four dozen more outages. “During the outages, Robinhood failed to process trades in a timely manner or at all, and it was discovered that Robinhood’s continuity plan was nonexistent,” the complaint stated. “Robinhood simply abandoned its customers.”
Robinhood users were unable to use the services, unable to buy or sell securities, and unable to exercise option contracts through the website or the app during the many outages. In fact, the company admitted that its help centers were unavailable during the outages and that its phone support was “non-existent.”
The lawsuit accuses the company of gross negligence, breach of fiduciary duty, breach of contract, and unjust enrichment, among other things.
The amended complaint strengthened the users’ argument against Robinhood. The complaint is guided by a diversified legal team at the request of U.S. District Judge James Donato, who called for “newer and less experienced” lawyers to take the helm of the class action. Among the executive committee representing Robinhood users is Leslie Pescia of Beasley Allen Law Firm.
“It’s an honor to be selected by Judge Donato to serve the court in a leadership role on the Executive Committee,” Pescia said. “This is very important litigation that exposes how the defendant’s poor planning and failure to deliver the services it promised blocked its customers from participating in the stock market during a significantly critical time. I look forward to working with the rest of the committee and legal team as we seek to hold Robinhood accountable and ensure that investor protection is a top priority.”
In addition to Leslie, Beasley Allen lawyers Dee Miles, head of the firm’s Consumer Fraud Section, and James Eubank partnered with Jennie Anderson of Andrus Anderson LLP in April to file the suit on behalf of the investors. The team filed the class action lawsuit in April.