New York law firm files class action lawsuit against Strategy, accusing it of misleading investors about Bitcoin strategy profitability

Odaily Planet Daily News New York law firm Pomerantz LLP has filed a class action lawsuit against Strategy (formerly MicroStrategy) in the Eastern District Court of Virginia, alleging that it issued false and misleading statements about the profitability of its Bitcoin investment strategy between April 30, 2024 and April 4, 2025, and allegedly violated federal securities laws. The lawsuit alleges that Strategy exaggerated the profitability of Bitcoin investments and financial operations, downplayed the risk of price fluctuations, and did not fully disclose the actual impact of adopting FASB accounting standard ASU 2023-08 on financial statements. The standard requires crypto assets to be measured at fair value, replacing the previous cost impairment model that only recognized impairment when prices fell. Pomerantz pointed out that the company generated $5.9 billion in unrealized losses based on the new accounting standards in the first quarter of 2025, causing its stock price to fall by more than 8%, but the company continued to issue optimistic forecasts and concealed potential huge losses. Other investors can now apply to join the class action lawsuit by July 15. (The Block)