A New York law firm has filed a class action lawsuit against Strategy, alleging that it made false disclosures about its bitcoin investments

According to The Block, the New York law firm Pomerantz recently filed a class action lawsuit against Michael Saylor-led Strategy (formerly MicroStrategy), alleging that the company violated federal securities laws by making false and misleading statements about the profitability of its bitcoin investment strategy. The lawsuit, filed in the Eastern District of Virginia, represents Strategy investors between April 30, 2024 and April 4, 2025. Other investors have until July 15 to join the class action.
The lawsuit alleges that Strategy overstated the profitability of its bitcoin investment strategy and money management business, downplayed the volatility risk of bitcoin, and failed to fully disclose the impact of the adoption of new accounting standards (ASU 2023-08) on financial statements. Specifically, in Quarter 1 2025, Strategy reported an unrealized loss of $5.90 billion in digital assets due to the adoption of the new standards, causing the stock price to fall by more than 8% at the time. Pomerantz accused the company of highlighting only bitcoin gains while concealing significant losses that could occur under fair value measurement.