Zeta Global Holdings Faces Class Action
Analysis based on 8 articles · First reported Jan 07, 2025 · Last updated Jan 17, 2025
The class action lawsuit against Zeta Global Holdings and the allegations of fraudulent data practices have caused a significant negative impact on Zeta Global Holdings' stock price, which fell 37%. This event highlights the risks associated with companies whose growth is dependent on potentially illicit data acquisition methods, potentially leading to increased scrutiny on similar marketing technology firms.
A class action lawsuit has been filed against Zeta Global Holdings and its senior executives by Bleichmar Fonti & Auld LLP, alleging violations of federal securities laws. The lawsuit stems from a November 13, 2024, report by Culper Research titled 'Zeta Global Holdings Corp (ZETA): Shams, Scams, and Spam,' which claimed that Zeta Global Holdings' marketing platform was powered by data from 'consent farms' – sham websites designed to gather consumer data under false pretenses. Culper Research's investigation suggested that these consent farms were responsible for a significant portion of Zeta Global Holdings' growth and Adjusted EBITDA, and could lead to severe regulatory action. Following the report's publication, Zeta Global Holdings' stock price plummeted by 37% in a single day. Investors have until January 21, 2025, to seek appointment as lead plaintiff in the case, which is pending in the United States — United States District Court for the Northern District of California.
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