Investors who sued online brokerages over claims they were unfairly blocked from trading shares of high-flying stocks like GameStop Corp. may have a long wait before their cases are resolved.
So far, at least 18 lawsuits have been filed against Robinhood Markets in California, Connecticut, Florida, Illinois, New Jersey, Oregon, Pennsylvania and Texas, mostly alleging restrictions by the trading platform that amounted to a breach of contract, court records show. Some also seek damages on behalf of other aggrieved investors.
While such claims already must overcome the broad powers brokerages have to block or restrict transactions on their platforms, the path through the courts could take months or even years to resolve, with mandatory arbitration in some cases and delays for consolidation of similar lawsuits, legal experts said.