This case was last updated from U.S. District Courts on 01/24/2023 at 03:43:50 (UTC).

Rubin v. Dorsey et al

Case Summary

On January 13, 2023, Michael Rubin (“Plaintiff”), represented by David C. Katz of Weiss Law, filed a civil enforcement lawsuit against Block, Inc. (“Block” or the “Company”), Jack Dorsey, Roelof Botha, Amy Brooks, Shawn Carter, Paul Deighton, Randy Garutti, James Mckelvey, Mary Meeker, Lawrence Summers, and Darren Walker (collectively, “Defendants”), seeking declaratory relief and the disgorgement of ill-gotten gains for alleged violation of the Securities and Exchange Act (the “Exchange Act”). This case was filed in the U.S. District Court for the Southern District of New York

In the complaint, the plaintiff alleged, “This is a stockholder derivative action brought against the members of the Block Board of Directors (the ‘Board’) for their breaches of fiduciary duties, violations of the federal securities laws, and other misconduct, which resulted in substantial damage to the Company and its stockholders. Block is a global technology company offering Cash App, a financial platform which provides mobile payment services for consumers. Critical to these core operations is the gathering and storage of customer’s personal identification information (‘PII’).”

Plaintiff further alleged, “Companies that gather and store PII undertake strict responsibilities under federal and state laws, as well as under established industry standards. The Individual Defendants knew of these legal requirements, as well as the substantial risk to the Company’s financial condition and core operations from breaches in data security and the need to adopt reasonable best cybersecurity practices, having acknowledged these very risks repeatedly in public filings.”

Plaintiff also alleged, “Individual Defendants failed to implement and monitor reasonable and appropriate internal controls over customers’ PII. Security breaches on the Cash App platform dating back to 2020, should have, but did not, serve as red flags to spur the Individual Defendants to investigate and take action.”

The plaintiff then alleged, “In December 2021, the consequences of the Individual Defendants’ utter failure to implement and monitor internal controls over the Company’s data security became apparent when the Company suffered a major data breach potentially compromising over eight million customers’ PII. The Individual Defendants compounded the damage by failing to cause Block to comply with the various federal and state laws requiring timely disclosure to consumers that their PII was unlawfully accessed.”

Additionally, the plaintiff alleged, “Individual Defendants’ breaches of fiduciary duty and other misconduct, Block has sustained substantial damages and irreparable injury to its reputation. The Individual Defendants’ violations of the federal securities laws, including their securing the re-election of certain directors through a false and misleading proxy statement and causing the Company to repurchase shares on the open market at artificially inflated prices, have likewise caused material damage to the Company.”

Plaintiff also alleged that “Plaintiff did not make a demand prior to bringing this action because it would be futile. The Company’s directors are neither disinterested nor independent. In the absence of this action, Block will neither recover its damages nor properly remediate the weaknesses in its internal controls and corporate governance practices and procedures.”

Plaintiff presented five claims for relief, including for alleged violation of Sections 10(b) and 14(a) of the Exchange Act, breach of fiduciary duty, contribution, and indemnification.

In the prayer for relief, the plaintiff requested a judgment granting declaratory relief. The plaintiff also requested an award for damages and the disgorgement of ill-gotten gains along with pre- and post-judgment interest. 

This is a summary of a legal complaint. All statements, claims, and allegations listed herein reflect the position of the plaintiff only and do not represent the position of UniCourt. Additionally, this case summary may not reflect the current position of the parties to this litigation or the current status of this case. To view the latest case updates and court documents, please sign up for a UniCourt account.

Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    1:23-CV-00322

  • Filing Date:

    01/13/2023

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Finance - Security/Commodity/Exchange

 

Party Details

Plaintiff

Michael Rubin

Defendants

Jack Dorsey

Roelof Botha

Amy Brooks

Shawn Carter

Paul Deighton

Randy Garutti

James McKelvey

Mary Meeker

Lawrence Summers

Darren Walker

Nominal Defendant

Block, Inc.

Attorney/Law Firm Details

Plaintiff Attorney

David Corey Katz

Attorney at Weiss Law

305 Broadway, 7Th Floor

New York, NY 10007

 

Court Documents

#1

(#1) COMPLAINT against Block, Inc., Roelof Botha, Amy Brooks, Shawn Carter, Paul Deighton, Jack Dorsey, Randy Garutti, James McKelvey, Mary Meeker, Lawrence Summers, Darren Walker. (Filing Fee $ 402.00, Receipt Number ANYSDC-27201364)Document filed by Michael Rubin..(Katz, David) (Entered: 01/13/2023)

#2

(#2) CIVIL COVER SHEET filed..(Katz, David) (Entered: 01/13/2023)

#3

(#3) STATEMENT OF RELATEDNESS re: that this action be filed as related to 22-cv-08636 (RA). Document filed by Michael Rubin..(Katz, David) (Entered: 01/13/2023)

 

Docket Entries

  • 01/17/2023
  • DocketCASE REFERRED TO Judge Ronnie Abrams as possibly related to 22-cv-8636. (jgo) (Entered: 01/17/2023)

    [+] Read More [-] Read Less
  • 01/17/2023
  • DocketCase Designated ECF. (jgo) (Entered: 01/17/2023)

    [+] Read More [-] Read Less
  • 01/17/2023
  • DocketCASE OPENING INITIAL ASSIGNMENT NOTICE: The above-entitled action is assigned to Judge Unassigned. .(jgo) (Entered: 01/17/2023)

    [+] Read More [-] Read Less
  • 01/13/2023
  • View Court Documents
  • Docket(#3) STATEMENT OF RELATEDNESS re: that this action be filed as related to 22-cv-08636 (RA). Document filed by Michael Rubin..(Katz, David) (Entered: 01/13/2023)

    [+] Read More [-] Read Less
  • 01/13/2023
  • View Court Documents
  • Docket(#2) CIVIL COVER SHEET filed..(Katz, David) (Entered: 01/13/2023)

    [+] Read More [-] Read Less
  • 01/13/2023
  • View Court Documents
  • Docket(#1) COMPLAINT against Block, Inc., Roelof Botha, Amy Brooks, Shawn Carter, Paul Deighton, Jack Dorsey, Randy Garutti, James McKelvey, Mary Meeker, Lawrence Summers, Darren Walker. (Filing Fee $ 402.00, Receipt Number ANYSDC-27201364)Document filed by Michael Rubin..(Katz, David) (Entered: 01/13/2023)

    [+] Read More [-] Read Less
related-case-search

Dig Deeper

Get Deeper Insights on Court Cases


Latest cases where Block and Company Inc is a litigant

Latest cases represented by Lawyer David C Katz