Roaring Kitty, the influencer famous for driving GameStop’s stock surge in 2021, has recently purchased 9 million shares of Chewy Inc. This move comes as Keith Gill, also known as Roaring Kitty, faces a class-action lawsuit accusing him of manipulating GameStop’s stock price.
In a recent filing with the U.S. Securities and Exchange Commission, Gill disclosed that he now owns a significant 6.6% stake in Chewy Inc., a major pet products retailer listed on the New York Stock Exchange. Following this news, Chewy’s shares jumped by 22% in premarket trading.
Roaring Kitty Buys $245M Chewy Stake Amid GameStop Lawsuit
The SEC filing reveals that Roaring Kitty, also known as Keith Gill, has acquired a massive 9.01 million shares of Chewy Inc. (CHWY), worth $245.18 million. This substantial investment makes Gill one of the largest shareholders in Chewy. The move follows a cryptic social media post by Gill featuring a dog, which hinted at his future investment strategy.
Gill’s investment significantly impacted the market, causing Chewy’s stock to hit its highest level in nearly a year during intraday trading. The stock surged 21.92% to $33.21 in pre-market trading on July 1.
However, the gains for Chewy contrast sharply with the performance of GameStop (GME), which saw a 5% drop in pre-market trading on Monday. Despite his success with Chewy, Gill is facing legal troubles related to his past activities with GameStop. A class-action lawsuit filed on June 28 accuses Gill of securities fraud and alleges he was involved in a “pump and dump” scheme. Plaintiffs claim his social media posts misled investors and led to significant financial losses.
Legal Expert Doubts Success of GameStop Lawsuit Against Roaring Kitty
Former prosecutor Eric Rosen has expressed doubt about the lawsuit filed against Keith Gill, also known as Roaring Kitty, suggesting that proving the allegations may be difficult. Despite significant fluctuations in GameStop’s stock price linked to Gill’s online activity from May to June, Rosen questions the case’s strength.
The lawsuit alleges that Gill committed securities fraud by failing to properly disclose his transactions involving GameStop options calls, which allegedly misled his followers and caused financial losses for some investors.
Plaintiff Martin Radev, represented by the Pomerantz law firm, claims he suffered losses due to an alleged scheme of inflating and then quickly selling GameStop stock. Radev bought 25 GameStop shares and three call options starting in mid-May, which subsequently lost value.
GameStop’s stock price has continued to decline, dropping 6.89% to $22.99 in Monday’s pre-market session. Last week, the stock closed at $24.69, marking a 1.59% decrease on Friday, June 28.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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