There's more bad news for Lyft: Investors are suing the ridesharing company, claiming it intentionally exaggerated its market position during its IPO process in late March.
Two separate class-action lawsuits were filed against Lyft on Wednesday, both in state court in San Francisco, Bloomberg reports. This comes just weeks after the company's rough entrance to the public market--Lyft's shares closed at $58.36 on Thursday, down significantly from its debut price of $72 per share.
"The investors claim Lyft was exaggerating in its prospectus when it said its U.S. market share was 39 percent," the Bloomberg report reads. For comparison's sake, a Barron's report on Tuesday cites a Guggenheim analysis claiming that Uber's market share should be roughly 55 percent higher than Lyft's, based on S-1 filings from both companies.
That math doesn't add up.
Bloomberg notes that both lawsuits additionally accuse Lyft of hiding plans to temporarily recall roughly 3,000 e-bikes from New York City, San Francisco, and Washington, D.C. The recall, announced on Sunday, followed reports of stronger-than-expected brakes flipping riders over their front handlebars--an issue that Uber acknowledged also experiencing with its e-bikes, according to The Washington Post.
Uber is facing its own IPO-related challenges: The company's S-1 filing acknowledged that it may never be profitable, leaving many investors unsure about the ridesharing giant's immediate future. The company is scheduled to begin trading on the public market in early May.