Ryan Cohen (Wikipedia)
GameStop CEO Ryan Cohen and his investment firm RC Ventures are facing a lawsuit filed by the company formerly known as Bed Bath & Beyond, seeking to recover $47.2 million in trading profits allegedly gained through insider trading.
On Friday, U.S. District Judge Naomi Reice Buchwald in Manhattan ruled that the case will proceed, stating that Cohen must defend against claims he violated “short-swing” trading laws by buying and selling over 10% of Bed Bath & Beyond’s stock within a six-month period.
Under U.S. securities law, insiders who profit from short-term trades in their company’s stock may be required to return those profits to the company. The lawsuit alleges that Cohen’s trades occurred just before Bed Bath & Beyond filed for bankruptcy, sparking accusations of strategic timing for personal gain.
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This legal challenge could impact Cohen’s reputation as a retail investor icon, particularly after his high-profile role in GameStop’s meme stock surge. The case also highlights increasing scrutiny on insider trading practices during volatile market events.
Bed Bath & Beyond was a well-known American retailer specializing in home goods. Founded in 1971, the company grew to become a major player in the industry, recognized for its wide selection of merchandise and its popular coupons.
However, in recent years, Bed Bath & Beyond faced significant challenges due to the rise of e-commerce, increased competition, and internal strategic missteps. These difficulties ultimately led to the company filing for Chapter 11 bankruptcy on April 23, 2023.
Ryan Cohen (born in 1986) is a Canadian entrepreneur, business executive, and activist investor. He is best known as the founder of the e-commerce company Chewy and the current Chairman and CEO of GameStop. He led Chewy’s growth, focusing heavily on customer service, which became a key differentiator for the company.
Cohen has a history of early-stage investing and has also held significant stakes in other companies, including Apple and Bed Bath & Beyond (though he later sold his stake in Bed Bath & Beyond)
Ryan Cohen is seen as a significant figure in both the e-commerce and “meme stock” phenomena, known for his business acumen, focus on customer experience (at Chewy), and his efforts to revitalize GameStop.
