Funko, Inc., known for its popular vinyl figures and bobbleheads inspired by movies, TV shows, and video games, is currently involved in a class action settlement. The company has agreed to settle allegations of misleading investors before its initial public offering (IPO). If you purchased Funko stock during its November 1, 2017 IPO, you may be eligible for a one-time payment as part of this settlement. Here’s everything you need to know about the settlement, including who qualifies, how to apply, and important deadlines.
What Is the Allegation Against Funko?
The class action lawsuit against Funko claims that the company misled its investors about its financial health prior to its IPO. Specifically, Funko allegedly used a tactic known as “channel stuffing,” where the company oversupplied retailers with products in order to make its sales figures appear better than they actually were. This tactic gave investors a false impression of the company’s profitability, causing Funko’s stock to be overvalued.
When the true financial condition of Funko became clear, the company’s stock price dropped, leading to financial losses for investors. Although Funko denied any wrongdoing, the company agreed to settle the lawsuit for $14.75 million to avoid further litigation.
Who Qualifies for Compensation?
The settlement is open to individuals who purchased Funko common stock during its November 1, 2017 IPO. If you are an eligible investor, you may qualify for a cash payment based on the number of shares you bought and sold during the class period.
Here’s how the payments work:
- For those who bought Funko IPO shares and sold them before June 30, 2018: You’ll receive compensation based on the difference between the price at which you bought and sold the shares.
- For those still holding Funko IPO shares: You may receive up to $0.91 per share, depending on how many shares you still own.
The final payment amounts will vary and depend on the total number of claims submitted and the number of shares involved in each claim.
Important Dates to Remember
If you are eligible for the settlement, it’s crucial to keep track of the following important dates:
- Claim Form Deadline: You must submit your claim forms by July 2, 2025 to qualify for compensation.
- Final Approval Hearing: The final approval hearing for the settlement will take place on June 6, 2025.
- Opt-Out or Objection Deadline: The deadline to opt out or object to the settlement has already passed.
To submit a claim, you will need to provide acceptable proof, such as documentation related to the registration statement and prospectus from Funko’s IPO.
Other Settlement Opportunities
If you don’t qualify for the Funko settlement, you may still be eligible for compensation from other ongoing settlements. For example, some Americans may receive up to $5,300 from a different settlement, provided they received a required notice by mail. Additionally, there is a $3.1 million “recall” settlement, but you’ll need to provide proof of purchase to qualify for that one.
If you purchased Funko stock during its November 1, 2017 IPO and experienced losses due to misleading information about the company’s financial health, you may be eligible for a payout as part of the $14.75 million settlement. Be sure to submit your claim by July 2, 2025, and keep an eye out for any other potential settlements that may apply to you. It’s important to stay on top of the deadlines and requirements to ensure you don’t miss out on compensation.
