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Zillow to pay $212.5 million to settle class action over failed real estate venture
Reuters • • business
Key Points:
- Zillow agreed to a settlement in a securities fraud lawsuit without admitting wrongdoing, pending a judge's approval.
- The lawsuit followed a 32% drop in Zillow's stock price after it was revealed that most homes in its Zillow Offers inventory were worth less than the company paid.
- Zillow subsequently shut down Zillow Offers, took a $304 million writedown, and laid off 25% of its workforce.
- Shareholders claimed they were misled by Zillow's optimistic portrayal of Zillow Offers, while Zillow denied any securities fraud.
- The settlement, partially covered by insurance, is believed to be the largest securities settlement in the federal court district that includes Seattle.
