New York Law Firm Files Class Action Lawsuit Against Strategy, Alleging Misleading Bitcoin Investment Disclosure

BlockBeats News, July 3rd, according to The Block, the New York-based law firm Pomerantz LLP recently filed a class-action lawsuit against Michael Saylor-led Strategy Company (formerly MicroStrategy), alleging that the company made false and misleading statements about the profitability of its Bitcoin investment strategy, in violation of federal securities laws. This lawsuit, filed in the Eastern District of Virginia court, represents Strategy investors from April 30, 2024, to April 4, 2025. Other investors can join the class-action lawsuit until July 15.

The key points of the lawsuit include allegations that Strategy overstated the profit potential of its Bitcoin investment strategy and fund management business, downplayed the volatility risk of Bitcoin, and failed to adequately disclose the impact of adopting the new accounting standard (ASU 2023-08) on its financial statements. Specifically, in the first quarter of 2025, due to the new standard adoption, Strategy reported a $5.9 billion unrealized loss on digital assets, leading to an over 8% drop in the stock price at that time. Pomerantz accuses the company of only emphasizing Bitcoin gains while concealing significant losses that could arise under fair value measurement.