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The lawsuit alleges that Warner Brothers inflated subscriber numbers by including AT&T customers with bundled access who never actively signed up for HBO Max—a tactic similar to how Amazon Prime's subscriber counts might include members who rarely use Prime Video. Such practices misled shareholders about the true growth and profitability of HBO Max, a core asset of the company’s streaming strategy.
Key Details of the Case
Misleading Numbers: Warner Brothers reportedly included Verizon customers and others who received free or bundled access, inflating their subscriber figures.
Potential Impact: Over 700 million shares were issued to Discovery shareholders during the merger based on these inflated figures, meaning hundreds of thousands of investors could be affected.