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San Francisco 49ers CEO Jed York is facing two lawsuits stemming from his connection on the board of a Santa Clara-based educational company, according to the San Francisco Chronicle.
Specifically, York is being sued for alleged insider trading and violations of federal securities. York, along with other directors of Chegg Inc. have been accused of concealing the company’s role in aiding college students cheat on online exams. The lawsuits claim that students used a Chegg account to get instant answers to questions on college exams administered online, thus leading to the company’s revenue rising immensely during the pandemic.
The company’s revenues and stock market price took a massive hit when the pandemic, however, when colleges got back to in-person testing, according to the lawsuits. The company’s stock currently trades at under $11, a massive drop from its February 2021 peak of $113.51.
York and Chegg CEO Dan Rosenweig are among company executives being accused of illegal insider trading after they allegedly unloaded Chegg stock at the top of the market but did not inform investors about the extent of the cheating that had taken place. The lawsuits claim that York pocketed $1.4 million on the sale of 20,000 shares “at artificially inflated prices.”
A company spokesperson said, via email to the Chronicle, that the lawsuits are “without merit” and that the company is “vigorously defending itself.” The 49ers issued a statement, saying they are “proud of the work we accomplished with Chegg to provide scholarships for first-generation students.” The 49ers began working with Chegg in 2019, when they funded up to $100,000 in scholarships for first-generation college students in the Bay Area.
York, who was named the 49ers president in December of 2008, has been on the Chegg board for the past 10 years. During that time, he has turned a profit of $4.9 million on sales of…
Source link : https://www.cbssports.com/nfl/news/49ers-ceo-jed-york-being-sued-for-alleged-insider-trading-securities-violations/
Author : Bryan DeArdo
Publish date : 2023-08-10 13:46:56
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