Faruqi & Faruqi, LLP Files Class Action Lawsuit Against Fastly, Inc.

NEW YORK, Aug. 27, 2020 (GLOBE NEWSWIRE) -- Faruqi & Faruqi, LLP, a leading national securities law firm, has filed a class action lawsuit on behalf of all those who purchased Fastly, Inc. (“Fastly” or the “Company”) (NYSE:FSLY) common stock between May 6, 2020 and August 5, 2020, seeking to recover damages for alleged violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”). The case, Betancourt v. Fastly, Inc., et al., No. 3:20-cv-06024, was filed on August 27, 2020 in the United States District Court for the Northern District of California. If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today.

If you invested in Fastly common stock between May 6, 2020 and August 5, 2020 and would like to discuss your legal rights, click here: www.faruqilaw.com/FSLY. There is no cost or obligation to you.

You can also contact us by calling Richard Gonnello toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to rgonnello@faruqilaw.com.

Fastly is the provider of an edge cloud platform. The complaint charges Fastly and certain of its officers with violations of the Exchange Act.

The lawsuit focuses on whether Defendants violated federal securities laws by knowingly and/or recklessly making false and/or misleading statements about the Company’s business, operations, and prospects. Specifically, the complaint alleges that Defendants made false and/or misleading statements and/or failed to disclose: (1) that Fastly’s largest customer was ByteDance, operator of TikTok, which was known to have serious security risks and was under intense scrutiny by U.S. officials; (2) that there was a material risk that Fastly’s business would be adversely impacted should any adverse actions be taken against ByteDance or TikTok by the U.S. government; and (3) that, as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

On August 5, 2020 after market close, Fastly held its second quarter (“Q2”) 2020 earnings conference call. During the call, Defendants disclosed that ByteDance, the Chinese company that operates the wildly popular mobile app TikTok, was Fastly’s largest customer in Q2 2020, and that TikTok represented about 12% of Fastly’s revenue for the six months ended June 30, 2020.

This news shocked the market, as TikTok had been under heavy scrutiny by U.S. officials and others since at least late 2019 due to fears that the data it collects from its users could be accessed by the Chinese government. Indeed, on July 31, 2020, President Trump announced a plan to ban TikTok in the U.S. over national security concerns. As Fastly’s Chief Executive Officer admitted on the Q2 2020 earnings call, “any ban of the TikTok app by the US would create uncertainty around our ability to support this customer[,]” and “the loss of this customer’s traffic would have an impact on our business.”

On this news, Fastly’s share price fell $19.28, or approximately 17.7% from the previous trading day’s closing price of $108.92, to close at $89.64 on August 6, 2020. Fastly’s shares continued to decline on August 6, 2020, when President Trump issued an executive order effectively banning TikTok, dropping another $10.31 per share from the closing price on August 6, 2020, or approximately 11.5%, to close at $79.33 on August 7, 2020.

The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.

Faruqi & Faruqi, LLP also encourages anyone with information regarding Defendants’ conduct to contact the firm, including whistleblowers, former employees, shareholders and others.

Attorney Advertising. The law firm responsible for this advertisement is Faruqi & Faruqi, LLP (www.faruqilaw.com). Prior results do not guarantee or predict a similar outcome with respect to any future matter. We welcome the opportunity to discuss your particular case. All communications will be treated in a confidential manner.

CONTACT:
FARUQI & FARUQI, LLP
685 Third Avenue, 26^th Floor
New York, NY 10017
Attn: Richard Gonnello, Esq.
rgonnello@faruqilaw.com
Telephone: (877) 247-4292 or (212) 983-9330