#United States #California #Class Action #securities lawsuit #Veritone

Potential Class Action Against Veritone, Inc.

Investors Alert: A recent announcement from Levi & Korsinsky, LLP has put Veritone, Inc. (NASDAQ: VERI) on the radar for a potential securities class action. This follows allegations involving significant revenue overstatements that have reportedly cost shareholders millions. With the appointment of two of the company's senior executives, the stakes are high for affected investors.

Background of the Allegations

The class action pertains to a timeframe from October 14, 2025, to April 14, 2026, during which a striking revelation regarding Veritone’s accounting methods surfaced. After the company disclosed ongoing challenges in finalizing accounting for certain revenue transactions, its shares plummeted by 29.5% — a loss of $0.77 per share in a single session. This financial downturn forced a complete restatement of the company's Q3 2025 financial statements, raising serious questions regarding the company's internal controls and reporting practices.

Named Defendants in the Lawsuit

The lawsuit identifies CEO Ryan Steelberg and CFO Michael L. Zemetra as key individuals responsible for the alleged misconduct. These executives are accused of having the authority and knowledge necessary to control Veritone's SEC filings, press releases, and interactions with institutional investors — areas critical for maintaining transparent and accurate financial reporting.

Section 20(a) Control Person Framework

The lawsuit contends that both Steelberg and Zemetra possessed access to crucial non-public information that indicated discrepancies in how certain revenues and associated costs were recorded. Their alleged lack of action regarding these discrepancies is a focal point of the lawsuit, as it suggests a failure to uphold their responsibilities under the Sarbanes-Oxley Act.

Implications of Sarbanes-Oxley Compliance

Notably, under the Sarbanes-Oxley Act, Steelberg and Zemetra not only had to certify the accuracy of Veritone's quarterly and annual filings personally, but they also needed to address existing weaknesses in internal controls. Their failure to do so raises pressing concerns about accountability at the highest levels of the company and could lead to serious repercussions.

How Affected Investors Can Respond

Investors are encouraged to evaluate whether they qualify for participation in the lawsuit before the July 20, 2026, deadline for lead plaintiff appointment. Key questions concerning the lawsuit include:
- Who are the named defendants? The lawsuit names Veritone, Inc. alongside Steelberg and Zemetra as individual defendants responsible for certifying financial disclosures.

- What are the specific allegations? The complaint highlights claims of materially false statements related to revenue recognition that misled investors.

- What is a lead plaintiff and its significance? A lead plaintiff represents the entire group of affected investors, typically being an investor who has undergone significant documented losses. This appointment provides oversight of the case's proceedings.

Participating in the Class Action

Importantly, investors do not need to retain shares to qualify; those who sold stocks during the class period and incurred losses are still eligible. Participation is contingent on documented losses rather than stock ownership. The class action is linked with a contingency model, meaning there are no upfront costs for those participating.

Conclusion

As the situation develops, affected investors should consider their options carefully. The opportunity to seek redress in a class-action lawsuit may provide a pathway to recover losses incurred during this tumultuous period for Veritone. Interested investors are advised to reach out to Levi & Korsinsky for personalized guidance on joining this class action lawsuit.

To find out more about your rights or if you qualify to recover losses, contact Joseph E. Levi, Esq. at [email protected] or call (212) 363-7500.