Beautiful Virgin Islands

Tuesday, Jun 24, 2025

Investors file CLASS ACTION SUIT against Robinhood over GameStop ‘stonk’ suppression

Investors file CLASS ACTION SUIT against Robinhood over GameStop ‘stonk’ suppression

A group of investors has filed a class action complaint against the online brokerage Robinhood, after it stopped all buys of GameStop and other stocks. They call it a market manipulation aimed to protect short-selling hedge funds.

According to the lawsuit, filed on Thursday before a federal judge in the Southern District of New York, Robinhood “purposefully, willingly and knowingly” deprived retail investors of the ability to invest, accusing the brokerage of “manipulating” the market.


Robinhood “completely blocked retail investors” from buying GameStop stock “for no legitimate reason,” the lawsuit goes on to say, adding that the move appears to be calculated to benefit individuals and institutions who are not Robinhood customers but are “large institutional investors” into the company.

The plaintiffs are asking for an immediate injunction to reinstate GameStop stocks on Robinhood’s platform, and unspecified damages and punitive fees.

As the result of the block, GameStop stock fell from $469 a share on Thursday morning to only $126 by 11:20 am. It has since rallied back to $275 territory, but remains volatile.

Robinhood customers woke up on Thursday to an announcement they were no longer able to buy stocks of GameStop (GMEA), AMC Theaters (AMC), Blackberry (BB) or Nokia (NOK). The four companies were targets of retail investors congregating on Reddit over the past several weeks.

These investors sought to drive up the stock price of the companies in order to punish hedge funds who had been “short-selling” them to make a quick profit. The rise in stock prices caused the funds to lose billions.

Short sellers reportedly lost $14.3 billion on Wednesday alone, with one fund, Melvin Capital, requiring nearly $3 billion in bailouts to avoid bankruptcy. One of the firms that bailed out Melvin Capital, Citadel Securities, also facilitates trades made on Robinhood, working as a sort of middleman between the app and Wall Street’s exchanges.

Halting the buying – but not the selling – of the four companies’ stock meant that its price could only go down, thus helping the hedge funds.

 
There were reports that other brokerages such as WeBull have also disabled buying of GameStop and other “stonks” – a Reddit meme reference to common people trying to profit from the stock market.


While the retail investors may or may not have profited from buying stocks, the short-sellers are feeling the pain. GameStop stock surging by 1,000 percent appears to have inspired other retail investors into similar campaigns with other companies. Data analytics firm Ortex said Thursday that short-sellers have racked up $70.87 billion in losses just this month, with over 5,000 US firms holding losing shorts as of Wednesday.

Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Airlines Evaluate Flight Cancellations Amid Escalating US-Iran Tensions
Starmer Invites Innovators to Join Government Talent Scheme
UK Economy’s Strong Opening Quarter Shows Signs of Cooling
Harrods Seeks Court Order to Secure Al Fayed Estate for Victims
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
WATCH: Israeli forces show the aftermath of a massive airstrike at Iran's Isfahan nuclear site
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
Labubu Doll Drives Pop Mart to Status as China’s Most Valuable Toy Maker
Global Coal Demand Defies Paris Accord Goals
We have new information and breaking details to share about what is shaping up to be a historic air campaign tonight
Six Massive Bombs Dropped on Fordow; Trump: 'A Historic Moment for the U.S., Israel, and the World'
Fordow: Deeply Buried Iranian Enrichment Site in U.S.–Israel Crosshairs
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
Pakistan to nominate Trump for Nobel Peace Prize.
BBC Demands Perplexity AI Immediately Stop Using Its Content
Telegram Founder: I Will Leave My Fortune to Over 100 of My Children
Political Turmoil Resurfaces in Belgium Amid Economic Concerns
Fed policymakers divided on timing of interest rate cuts
Trump signals imminent agreement with Harvard University
Inheritance tax referendum alarms Swiss billionaire community
Japan cancels bilateral security meeting amid US defence demands
AI skeptic Emily Bender warns that ‘the emperor has no clothes’
Israel Confirms Assassination of Quds Force Commander in Tehran
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
Iranian Military Officers Reportedly Seek Contact with Reza Pahlavi, Signal Intent to Defect
FBI and Senate Investigate Allegations of Chinese Plot to Influence the 2020 Election in Biden’s Favor Using Fake U.S. Driver’s Licenses
Vietnam Emerges as Luxury Yacht Destination for Ultra‑Rich
Plans to Sell Dutch Embassy in Bangkok Face Local Opposition
China's Iranian Oil Imports Face Disruption Amid Escalating Middle East Tensions
Trump's $5 Million 'Trump Card' Visa Program Draws Nearly 70,000 Applicants
DGCA Finds No Major Safety Concerns in Air India's Boeing 787 Fleet
Airlines Reroute Flights Amid Expanding Middle East Conflict Zones
Elon Musk's xAI Seeks $9.3 Billion in Funding Amid AI Expansion
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Israeli Airstrike Targets Iranian State TV in Central Tehran
President Trump is leaving the G7 summit early and has ordered the National Security Council to the Situation Room
Taiwan Imposes Export Ban on Chips to Huawei and SMIC
Israel has just announced plans to strike Tehran again, and in response, Trump has urged people to evacuate
Netanyahu Signals Potential Regime Change in Iran
Juncker Criticizes EU Inaction on Trump Tariffs
EU Proposes Ban on New Russian Gas Contracts
Analysts Warn Iran May Resort to Unconventional Warfare
Iranian Regime Faces Existential Threat Amid Conflict
×