$OPEN: New CEO & Rabois Return Spark 36% Rally — But $39M Settlement Clouds Outlook

Court: D. Arizona

Case: 2:22-cv-01717

Opendoor’s stock soared 36% after appointing former Shopify COO Kaz Nejatian as CEO and naming co-founder Keith Rabois chairman. The leadership shake-up comes after CEO Carrie Wheeler resigned under investor pressure. Shares, once at risk of delisting in May, are now up more than 15x since June, pushing Opendoor’s market cap near $6B. Yet, despite the momentum, the company still carries the weight of a $39M investor settlement over claims it misled the market about its pricing algorithm and profitability.

• Kaz Nejatian named CEO, effective Sept. 12, after six years at Shopify.
• Keith Rabois returns as chairman, co-founder Eric Wu also rejoins board.
• Stock surged 36%, now trading near $9.87, up from <$1 in June.
• Market cap rebounds to $6B, up from < $400M just months ago.
• $39M settlement over algorithm misrepresentation still weighs on trust.

Timeline Overview

• Dec 21, 2020 — Opendoor goes public via SPAC at $31.25/share.
• Sep 19, 2022 — Bloomberg reports Opendoor lost money on 42% of sales in Aug.
• Sep 2022 — Analysts warn losses could be worse in Sept; stock declines further.
• 2023–2024 — Investors file claims alleging misleading statements on algorithm & profitability.
• 2025 — Opendoor agrees to a $39M settlement to resolve investor claims.

Allegations Include

• Misrepresenting the accuracy of its pricing algorithm.
• Overstating profit margin sustainability.
• Concealing inability to operate profitably in a downturn.

Investor Update

The $39M cash settlement compensates investors who bought shares during the affected period. While it closes one chapter, questions about the reliability of Opendoor’s tech-driven iBuying model and transparency remain live risks for shareholders.

You can check more information about it HERE.