According to the Complaint, Riskified Ltd. is an eCommerce risk management platform that uses machine learning to identify fraud.

On July 1, 2021, Riskified filed with the U.S. Securities and Exchange Commission a Registration Statement on Form F-1 for the IPO, which, after several amendments, was declared effective on July 28, 2021. The Registration Statement was used to sell to the investing public 20.125 million Riskified Class A ordinary shares at $21 per share, generating over $422 million in gross proceeds.

The Complaint alleges that the IPO’s Registration Statement made inaccurate statements of material fact because it failed to disclose the following adverse facts that existed at the time of the IPO: (i) as Riskified expanded its user base, the quality of Riskified’s machine learning platform had deteriorated (rather than improved as represented in the Registration Statement), because of, among other things, inaccuracies in the algorithms associated with onboarding new merchants and entering new geographies and industries; (ii) Riskified had expanded its customer base into industries with relatively high rates of fraud – including partnerships with cryptocurrency and remittance business – in which Riskified had limited experience and that this expansion has negatively impacted the effectiveness of Riskified’s machine learning platform; (iii) as a result, Riskified was suffering from materially higher chargebacks and cost of revenue and depressed gross profits and gross profit margins during its third fiscal quarter of 2021; and (iv) thus, the Registration Statement’s representations regarding Riskified’s historical financial and operational metrics and purported market opportunities did not accurately reflect the actual business, operations, and financial results and trajectory of Riskified prior to and at the time of the IPO, and were materially false and misleading, and lacked a factual basis.

On August 17, 2022, the Court issued an Order appointing Lead Plaintiff and Counsel. Lead Plaintiff filed an amended Complaint on September 15. On November 28, Lead Plaintiff filed a second amended Complaint. Defendants filed a Motion to Dismiss the second amended Complaint on January 20, 2023.

On June 2, 2023, the Court issued an Order granting Defendants' Motion to Dismiss and directed the Clerk of Court to enter judgment for the Defendants.