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Investors who bought or otherwise acquired Kornit Digital Ltd. ordinary shares between Feb. 17, 2021, and July 5, 2022, or acquired shares traceable to the company's November 2021 secondary offering, may be eligible to claim a cash payment from a class action settlement.
Kornit Digital Ltd. and certain executives agreed to pay $19.5 million to settle a securities class action lawsuit alleging they made false and misleading statements about the company's business and operations. The lawsuit claimed statements about Kornit's service contracts, the health of its business and a pull-forward of revenue inflated the share price until corrective disclosures in May and July 2022.
Who can file a claim?
The settlement class includes all persons and entities who purchased or otherwise acquired Kornit ordinary shares between Feb. 17, 2021, and July 5, 2022, inclusive, or pursuant and/or traceable to Kornit's secondary offering of ordinary shares in November 2021.
Additional details
- Both individuals and entities can be class members.
- The settlement includes investors who held shares in their own name and those who held through a broker or other nominee.
- The beneficial owner, not the record owner, must sign the claim form.
- Joint owners must each sign the claim form.
- Agents, executors, administrators, guardians and trustees may submit claims on behalf of others and must provide proof of authority.
- Each separate legal entity or separately managed account must submit a separate claim.
- Participants in and beneficiaries of any employee retirement or benefit plan covered by ERISA should not include plan purchases of Kornit shares on an individual claim form. Plan trustees may submit claims for those purchases.
How much can class members get?
The total settlement fund is $19,500,000. The amount each class member receives depends on several factors:
- The number of valid claims submitted
- The number of shares bought during the class period
- The timing of each purchase and sale
- The total recognized losses of all claimants
The settlement administrator will distribute payments on a pro rata basis according to the court-approved plan of allocation:
- The estimated average recovery is $0.53 per eligible share before deductions. After estimated deductions of $0.13 per share for attorneys' fees and expenses, the estimated average recovery is about $0.40 per share before settlement administration costs.
- Actual payments may be higher or lower depending on individual claims and the total number of valid claims.
- The settlement administrator will calculate a recognized loss for each share bought during the class period, applying different formulas depending on when class members bought and sold:
- Estimated artificial inflation is $1.24 per share for purchases from Feb. 17, 2021, through Feb. 14, 2022, $20.21 for purchases from Feb. 15 through May 10, 2022, and $8.28 for purchases from May 11 through July 5, 2022. Inflation falls to $0 on July 6, 2022.
- For shares sold before the close of trading on May 10, 2022, the recognized loss is $0.
- For shares bought before Feb. 15, 2022, and sold from May 11 through the close of trading on July 5, 2022, the recognized loss is the lesser of $0.25 per share or the purchase price minus the sale price.
- For shares bought on or after Feb. 15, 2022, and sold from May 11 through the close of trading on July 5, 2022, the recognized loss is the lesser of the artificial inflation at purchase minus $8.28 or the purchase price minus the sale price.
- For shares sold from July 6 through the close of trading on Oct. 3, 2022, the recognized loss is the least of the artificial inflation at purchase, the purchase price minus the average closing price from July 6, 2022, through the sale date (p. 23 of the class notice), or the purchase price minus the sale price.
- For shares held as of the close of trading on Oct. 3, 2022, the recognized loss is the lesser of the artificial inflation at purchase or the purchase price minus $28.67, the average closing price from July 6 through Oct. 3, 2022.
- The settlement administrator will set any recognized loss that calculates to a negative number or zero to $0.
- If a class member had an overall gain on Kornit shares during the class period, the recognized claim is $0. If the overall loss is less than the recognized claim, the settlement administrator will limit the claim to that loss.
- Class members whose payment would be less than $10 will not receive a payout.
How to claim a Kornit Digital securities class action settlement payment
Class members may file a claim online or download, print and complete the PDF claim form and mail it to the settlement administrator. The claim deadline is Dec. 10, 2026.
Settlement administrator's mailing address: Kornit Securities Litigation, c/o JND Legal Administration, P.O. Box 91050, Seattle, WA 98111
Proof or documentation required to submit a claim
All class members must provide the last four digits of their Social Security number or taxpayer identification number. They must also provide holding, purchase and sale information, including:
- Number of shares held as of the opening of trading on Feb. 17, 2021
- Trade dates, number of shares, price per share and total purchase price for each purchase or acquisition between Feb. 17, 2021, and July 5, 2022
- Total number of shares bought or acquired between July 6, 2022, and Oct. 3, 2022
- Trade dates, number of shares, sale price per share and total sale price for each sale between Feb. 17, 2021, and Oct. 3, 2022
- Number of shares held as of the close of trading on Oct. 3, 2022
Class members must also provide documentation to support their holdings and transactions in Kornit ordinary shares. Acceptable proof includes:
- Trade confirmations
- Account statements
- Authorized statements from a broker or other financial institution containing the transactional and holding information found in a trade confirmation or account statement
Payout options
- Physical check
$19.5 million settlement fund
The $19,500,000 settlement fund includes:
- Settlement administration costs: To be determined
- Attorneys' fees: Up to $4,290,000
- Attorneys' expenses: Up to $350,000
- Payments to eligible class members: Remainder of the fund
Important dates
- Opt-out deadline: Oct. 28, 2026
- Fairness hearing: Nov. 18, 2026
- Deadline to file a claim: Dec. 10, 2026
When is the Kornit Digital securities class action settlement payout date?
The settlement administrator will issue payments after it completes processing all claims and the court resolves any appeals and grants final approval of the settlement.
Why did this class action settlement happen?
The class action lawsuit alleged Kornit Digital and certain executives made false and misleading statements about the company's service contracts, the strength of its business and a pull-forward of revenue. The plaintiffs claimed these statements inflated the share price and caused investor losses when corrective information reached the market in May and July 2022.
Kornit denied all allegations of wrongdoing but agreed to settle to avoid the costs, risks and delays of continued litigation.
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