GameStop Corp. Class A (GME.US) CEO involved in legal disputes, stock price falls below $20.

Although GameStop Corp. Class A (GME.US) stock price has dropped below the $20 mark, the CEO Ryan Cohen has recently become the focus of attention due to multiple legal disputes. As the company, once labeled as a "meme stock," faces uncertainty in the future, will Cohen's controversies become a new focus for investors and management distraction? Recently, the Federal Trade Commission (FTC) announced that Cohen will pay a civil penalty of $985,320 to settle charges of violating the Hart-Scott-Rodino Act (HSR Act). The act requires companies to report to federal antitrust agencies when acquiring a certain amount of stock in a company. According to the FTC's complaint, Cohen acquired over 562,000 shares of Wells Fargo & Company voting securities without proper disclosure, exceeding the reporting threshold of the HSR Act. The FTC pointed out that even though Cohen's shareholdings were less than 10% of the voting securities issued, his acquisition actions were not exempt from the HSR Act's investment exemption clause. The FTC documents mentioned that Cohen intentionally sought to influence business decisions of Wells Fargo & Company through his stock purchases, evidenced by emails he sent while vying for board seats and communications with the bank's leadership after the acquisition. Furthermore, Cohen and his company RC Ventures were sued by Bed Bath & Beyond in August, accusing Cohen of trading using inside information and making illegal profits of approximately $47 million. The lawsuit stated that during his tenure as a director at Bed Bath & Beyond, Cohen made numerous profitable trades with the company's stock. Meanwhile, the management of GameStop Corp. Class A has remained silent, except for releasing financial reports and submitting documents to the US Securities and Exchange Commission, as they actively develop strategies. The company disclosed that as part of achieving sustained profitability, GameStop Corp. Class A will continue to evaluate its international assets and operations to determine their strategic and financial fit, and remove redundant and underperforming assets. Additionally, the company has initiated a review of its store portfolio optimization, which may result in closing more stores than in previous years. Some investors speculate that besides driving profitability in GameStop Corp. Class A's traditional business, Cohen may have other plans. On Wednesday, GameStop Corp. Class A's stock price fell by 2.53% to close at $19.65, a decrease of about 70% from its 52-week high, nearing the 200-day moving average of $18.74. GameStop Corp. Class A's historical highest closing price was $86.88 on January 27, 2021 (adjusted for stock splits).