GoPro Facing Securities Class Action Over Karma Drone Problems

New to ClassAction.org? Read our Newswire Disclaimer

GoPro is the defendant in a class action lawsuit claiming the wearable camera and accessories company violated federal securities law by making materially false and misleading statements about its new “Karma” drone. The 14-page lawsuit alleges GoPro intentionally failed to disclose that its compact, foldable drone, designed to take aerial photographs with GoPro’s cameras, were prone to losing power midflight, causing the devices to fall out of the sky. The complaint also claims GoPro “significantly overstated” the utility of and customer demand for its Karma drone, knowing full well the aforementioned power loss problems would most likely call for a costly, prolonged recall.

With anticipation of a recall came a roughly seven percent dip in GoPro stock prices. Once a recall of approximately 2,500 Karma drones was officially announced on November 8, 2016, GoPro share prices fell another four-plus percent, prompting stockholders to take legal action.

“As a result of the defendant’s wrongful acts and omissions, and the precipitous decline in the market value of the company’s common shares, [the plaintiff] and other class members have suffered significant losses and damages,” the complaint reads.