CS Disco, Inc. Securities Fraud Investigation

Shamis & Gentile, P.A. is investigating potential derivative action claims on behalf of shareholders of CS Disco, Inc. ("CS Disco" or the "Company") (LAW) against certain of its directors and officers for alleged breaches of fiduciary duties and other violations of law. Concerned shareholders are advised to contact the firm now.

CS Disco provides cloud-native and artificial intelligence-powered legal solutions for electronic discovery, legal document review and case management for enterprises, law firms, legal services providers and governments. During the relevant period, CS Disco allegedly touted strong revenue growth attributed to customer usage of its cloud-based platform and asserted that it had good advance visibility into changes in demand from individual customers over time. Further, the Company allegedly acknowledged its rapid revenue growth was usage driven and may be subject to volatility, but did not inform investors that it had any indication of significant headwinds to its growth.

On August 11, 2022, CS Disco released financial results for the second quarter of 2022. The Company’s revenue growth had tapered drastically compared to prior quarters, and CS Disco alerted the market that it would no longer include in its guidance any revenues attributable to its largest customers for the entire year. On August 12, 2022, CS Disco common shares fell 53% on heavy trading volume. These events triggered the filing of a securities fraud class action. Further, this ongoing litigation raises questions regarding whether CS Disco’s board and executive officers failed to implement and maintain effective oversight and internal controls, potentially resulting in financial harm to the Company and its shareholders.

The law firm's investigation focuses on whether possible governance failures relating to these events constituted breaches of fiduciary duty and other violations of law. Accordingly, long-term CS Disco shareholders may be able to pursue claims on behalf of the Company against responsible directors and officers. A shareholder derivative action would attempt to recover damages on behalf of the Company. It would also seek corporate governance reforms designed to prevent similar misconduct in the future and improve long-term value.

Shamis & Gentile, P.A. stands out as an advocate for shareholders seeking corporate accountability and governance reforms. The firm is committed to pursuing derivative actions that benefit companies and their shareholders by recovering damages and implementing meaningful corporate governance improvements. Shamis & Gentile has recovered over $1 billion for consumers nationwide. Its extensive experience, expertise and resources enable the firm to resolve disputes in a wide range of matters, including derivative actions, class actions and complex commercial litigation.

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