To football fans, Jed York is known as the San Francisco 49ers’ CEO. On top of that, York is also involved in several various non-football-related business ventures.
Specifically, York is now facing multiple lawsuits for his interactions with Chegg Inc. after being sued for alleged insider trading along with violations of federal securities laws. Chegg Inc. is under fire for allegedly helping college students cheat on their online exams. York and other members associated with the online educational company have been accused of helping hide Chegg’s involvement in these illegal doings.
Adding to the mayhem is the fact that Chegg’s profits soared during the COVID shutdown before revenue quickly plummeted once students returned to school campuses. This is where Chegg Inc. is accused of “gross mismanagement and unjust enrichment” while making false statements in SEC filings that allowed the company to gain a significant profit.
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The lawsuits suggest that York and Chegg CEO Dan Rosenweig sold their stock at the peak of the market without bothering to clue investors in on the existing cheating allegations. By doing this, the lawsuit alleges York raked in $1.4 million in profit while selling off 20,000 shares at “inflated” prices that were boosted artificially.
In addition to this lawsuit, Chegg has also become the subject of an ongoing class-action filing accusing the business of securities fraud. But York is not involved or named in the class-action case.
York has been on the Chegg board of directors for ten years, being paid cash plus stock worth an estimated $2 million, while managing a profit of $4.9 million strictly on sales of company stock.
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