TaskUs is a business process outsourcing company that provides services to technology companies, including the moderation of user and advertiser generated content. The complaint alleges that throughout the Class Period, Defendants claimed that TaskUs had “industry-leading growth and profitability” and a “simply massive” market opportunity. The complaint further alleges that Defendants touted the size of the Company’s workforce and “low employee attrition levels” which “leads to lower hiring and training costs.” These statements were materially false and misleading. On January 20, 2022, Spruce Point Capital Management, LLC (“Spruce Point”) issued a report titled “Moderating the Bull Case Content” based on its “forensic financial and accounting review” of TaskUs. Spruce Point found that TaskUs, “has a pattern of exaggerated and inflated business claims, including revenue, and is covering-up financial strain with reduced disclosures, cherry-picked market data, and non-standard key performance metrics.” Additionally, Spruce Point stated, “we find evidence of increasing strain in the relationship” between TaskUs and its largest customer Facebook “and believe margins and cash flow are set to contract more than expected.” Spruce Point also stated, “we find a pattern of [TaskUs] embellishing the size of its workforce and making overly optimistic revenue growth claims.” This disclosure caused the value of TaskUs stock to decline dramatically, resulting in significant harm to investors.
For More information as well as to join this case please contact Atara Twersky, Esq. at atara@twerskylawgroup.com or atwersky@aftlaw.com. Atara is Principal at Twersky Law Group and Of counsel at AF&T law firm where she is director of Investor Services. Atara focuses her practice on assisting her clients with increasing their investment portfolio recoveries and ensuring that their portfolios remain healthy and robust. For more information on shareholder recoveries click here and to listen to Atara’s podcast with notable guests in the Pension fund Industry listen to Pension and Investments Podcast, on all matters related to your investment portfolio and more. For more information on Atara and her legal work connected to shareholder protection click here.
