A U.S. judge has ruled that former Bed Bath & Beyond investor Ryan Cohen can be sued by investors over a tweet he posted featuring an emoji that seemed to indicate an endorsement of the home goods retailer before it declared bankruptcy earlier this year.
The decision, issued Thursday by District Judge Trevor McFadden of Washington, D.C., concluded that Cohen and his company must face plaintiffs’ fraud claims, including their allegation that Cohen’s smiley moon emoji was a fraudulent misrepresentation.
The CNBC story was accompanied by a photo of a woman shopping at a Bed Bath store. Cohen reposted the CNBC story with a quip — “at least her cart is full” — and an emoji of a smiling moon. That phrase has become a common idiom among so-called meme-stock investors indicating that the stock is poised to soar, McFadden said.
When Cohen revealed he had sold all his shares in the company, Bed Bath & Beyond’s stock price plummeted. By August 22, shares were trading below $10. The company ultimately filed for bankruptcy the following April.alleging they’d been duped by Cohen and his company, RC Ventures. Lead plaintiffs lawyers Omar Jafri and Jeremy Lieberman of Pomerantz did not respond to a Reuters query.
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