b'that it was less applicable in the context of registrationin North America, Bikeshare Holdings LLC (Motivate). statements, IPOs, and Section 11 claims, as opposed toOn March 28, 2019, Lyft completed its IPO at a price of 10(b) claims, as stock prices were privately set in those$72 per share, generating proceeds of $2.34 billion. In instances and the public market has necessarily not hadits Registration Statement, Lyft detailed its commitment the opportunity to factor in information it may have intoto trust, safety, reliability and privacy, stated its U.S. the share price. The court explained that the defenseridesharing market share was up 17% from two years is generally not applicable at the pleading stage andbefore, grappled with its inability to obtain profitability in requires a heavy burden of proof that defendantsthe present or potentially in the future, and disclosed failed to meet.the risk that the companys bikes and scooters might The court also rejected defendants argument thatexperience quality problems or defects in the future. plaintiff relied on impermissible hindsight pleadingIt also disclosed that Lyft was a defendant in multiple with respect to statements involving Ubers financiallitigations related to accidents or other trust and safety results and risks associated with California laborincidents involving drivers or passengers. Within weeks classification laws, holding that the amended complaintof the IPO, news stories arose relating to rider safety, relied on events contemporaneous with the IPOincluding allegations of riders experiencing sexual such as a pre-IPO California Supreme Court decisionassault by drivers. Lyfts stock price subsequently fell that rendered Ubers classification of its drivers asmore than 20% between April 8 and April 10, 2019.independent contractors illegal in California. The courtAn investor brought a putative class action against also held that alleged misstatementssuch as its aLyft, its officers, and its directors alleging violations of new day at Uberwere not inactionable pufferySections 11, and 15 of the 1933 Act on the grounds that when taken in context of allegations that UbersLyfts offering documents contained material omissions past tolerance of sexual harassment and failure toand misleading statements relating to, among other comply with local laws remained very much present.things: (1) rider safety and related risk factors; (2) the Likewise, the court held that alleged misstatementscompanys market share; (3) first quarter losses; (4) the framed as forward-looking opinions were actionablecompanys bikeshare program; and (5) driver benefits. at the pleading stage because the facts known to theDefendants moved to dismiss on May 14, 2020, which defendants during the class periodsuch as thethe court granted in part and denied in part.facts set forth in the soon-to-be-released transparency report and Q1 2019 resultsdemonstrated [that defendants] knew otherwise. The court noted that, while defendants were correct that they did not needThe court further held that plaintiff adequately to disclose their 2Q2019 results during the 2Q 2019alleged that hypothetical risks included in the IPO, they were required to be transparent about the companys financial position, and thus not state, thatRegistration Statement about quality-control they expected growth to continue when Uber hadproblems and defects with shared bikes were sustained (though conveniently, not yet disclosed) its biggest losses to dayand had planned massivematerially misleading because, by the time restructuring and layoffs for a few weeks after theof the IPO, these risks were actually present IPO[.] Ubers failure, the court held made defendants statements [ ] misleading given the information availablerealities, as Lyfts bikeshare program was to them at the time the statements were made.already experiencing severe and pervasive Plaintiffs moved to certify the class on September 25,safety issues.2020 and defendants filed their answer to the amended complaint on September 30. The hearing for class certification is set for May 20, 2021.The court denied defendants motion and allowed the claims to proceed based on allegedly misleading In re Lyft Inc. Securities Litigation, Case No.risk factors regarding rider safety and the companys 19-cv-02690, 2020 WL 5366325 (N.D. Cal.bikeshare program. First, in assessing whether Sept. 8, 2020)statements about rider safety and related risk factors Safety Risks and Product Defects During IPO were misleading, the court noted that, while the Registration Statement disclosed general risks relating Lyft Inc. offers app-based services includingto illegal, improper, or otherwise inappropriate activity peer-to-peer ridesharing, and ride service hailing.by drivers and passengers, and pending safety-related In November of 2018, looking to expand its servicelitigation against Lyft, it omitted explicit reference to offerings, Lyft acquired the largest bikesharing platformpotential liability from sexual assaults by drivers against 37'