Attorneys Jeff Kwatinetz and Sean Burstyn of The Ferraro Law Firm are discussing the case, claiming that Robinhood ‘was on the lookout for Wall Street hedge funds’ at the expense of his clients.
Robinhood is facing a class action lawsuit after restricting several restrictions shares, including GameStop and AMC, two weeks ago.
“Robinhood knew that his actions would lead to a drop in the limited share prices,” reads the lawsuit filed by The Ferraro Law Firm. “In doing so, they were on the lookout for Wall Street hedge funds at the expense of the individuals who were customers of Robinhood.”
‘Robinhood restricts securities such as GME [GameStop] from its platform to slow down growth and benefit individuals and institutions that are not Robinhood customers, but are large institutional investors or potential investors of Robinhood, ”reads the lawsuit.
Robinhood did not return a request for comment from FOX Business.
This case is not related to a case that the family of Alex Kearns, a 20-year-old man who committed suicide last year, mistakenly thought he had lost more than $ 700,000 in a risky bet on Robinhood.
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Jeff Kwatinetz and Sean Burstyn, attorneys for The Ferraro Law Firm, are representing the plaintiffs in the lawsuit. Burstyn claimed that Robinhood ‘turned its back on its customers’ by placing restrictions on trade.
“This case is about Robinhood’s exposure to GameStop shares, and when it came up, it basically had a crash,” Burstyn said Monday on ‘Mornings with Maria’, adding that he believes a provision the company is using to defend his actions does not hold up in court.
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“After everyone suffered, they said, ‘There’s a provision that says,’ We can make adjustments here and there. “This provision was absolutely not considered,” Burstyn said.
“And if the provision is used in a court to release Robin Hood from liability for the serious negligence thereof, I do not believe any court will apply to it,” he added. “And I can say that as a lawyer it is contrary to the applicable law.”
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Kwatinetz further says he believes the company “built a platform designed to go down” and did not accept responsibility for its role in the market.
‘[Robinhood] came with this whole ‘Let’s democratize and give access to millennials and younger people’, ‘Kwatinetz told Maria Bartiromo. “They did not accept the responsibilities when it came to something like that.”
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Kwatinetz added that damages claimed in the lawsuit could amount to ‘billions’. “We still have a long way to go to find out exactly, you know how many people have been affected,” he said.
FOX Business’ David Aaro contributed to this report.