Strategy (the firm formerly known as MicroStrategy) saw a shareholder lawsuit alleging improper accounting practices dismissed after the plaintiffs voluntarily dropped their claims, according to court documents filed this week.
The June suit, brought by shareholders Abhey Parmar and Zhenqiu Chen, accused company insiders of breaches of fiduciary duty, unjust enrichment, abuse of control and gross mismanagement. The case’s dismissal follows a similar class-action filed in May that was also scrapped, reflecting a string of legal complaints the company has faced this year.
Experts told Decrypt that multiple law firms often file near-identical suits against the same company as they compete to be appointed lead counsel in a consolidated action. That dynamic can produce several overlapping filings even when the underlying claims are similar.
Why this matters: Strategy is the largest corporate holder of Bitcoin, with a reported stash of 638,460 BTC — roughly $72.5 billion at current prices — and its Nasdaq-listed shares (MSTR) are widely used by investors seeking institutional Bitcoin exposure. Litigation over accounting or disclosure practices can affect investor confidence, share-price volatility and the company’s governance spotlight.
The company’s pivot from enterprise software to a Bitcoin-focused treasury strategy — championed by co-founder Michael Saylor beginning in 2020 — helped fuel a dramatic stock rally: the shares traded near $14 when the firm first bought Bitcoin in August 2020 and have since risen to about $362.
Strategy has a history of regulatory trouble: in 2000 the company and several executives settled SEC charges related to overstated revenue and earnings, paying $10 million in disgorgement and $1 million in penalties without admitting or denying the allegations.
Investor takeaway: The recent dismissal removes one immediate legal pressure, but ongoing and potential future suits remain a risk for shareholders. Litigation outcomes, regulatory inquiries, and accounting questions can all influence the company’s stock and should factor into investment decisions.
Source: Decrypt. Read the original coverage for full details.
