SANTA CLARA — Jed York, the San Francisco 49ers’ CEO, spoke before Saturday’s preseason game and downplayed insider-trading allegations that recently came to light.
“It’s 18 months old. It’s a completely frivoulous lawsuit,” York said in a joint interview with this news organization and NBC Sports Bay Area.
“I think they’re grasping at straw to bring this out publicly now.”
Two lawsuits accuse York and others of financial improprieties regarding their work with Chegg Inc., a Santa Clara-based online education platform under fire for allegedly helping students cheat during the height of the pandemic. The lawsuits say York, specifically, made insider stock deals based on “nonpublic information,” demonstrating “his motive in facilitating and participating in the scheme.”
“I’m proud of our work with Chegg, proud of my work on the board and with its scholarship program,” York added. “I have no doubt this will be taken care of in no time.
“I wish I could say more but I will let the process play out.”
The lawsuits, consolidated in the U.S. District Court for Northern California earlier this year, say York, specifically, made insider stock deals based on “nonpublic information,” demonstrating “his motive in facilitating and participating in the scheme.”
Started in 2006, Chegg debuted on the New York Stock Exchange in 2013 — the same year York joined its board of directors — at $12.50 a share, raising $187.5 million for its initial public offering.
In 2019, Chegg and the 49ers announced a multi-year partnership to fund $100,000 in scholarships to first-generation college students in the Bay Area. For every first down made by the 49ers at Levi’s Stadium, Chegg would donate $500 to the scholarship fund. At the end of the season, five college students were selected to receive $20,000 each.
At the onset of the coronavirus pandemic in 2020, Chegg saw its subscribers surge as schools closed and students were forced to learn from home. Subscribers doubled by the end of 2020, and Chegg’s revenues increased by nearly 50% between the first quarter of 2020 to the second quarter of 2021, according to the lawsuit brought by shareholders Rak Joon Choi and Joseph Robinson.
Those lawsuits also accuse Chegg CEO Dan Rosensweig and six others of breaching their fiduciary duties to shareholders.
York is in his 13th year as the 49ers’ CEO and has been in the front office for nearly two decades. His parents, Denise DeBartolo York and Dr. John York, assumed majority control of the franchise’s ownership from her brother, Eddie DeBartolo, 23 years ago.
As for football matters, York declined to comment on the 49ers’ ongoing contract negotiations with Nick Bosa, who has not reported to training camp but is expected to sign a contract extension in the coming weeks as the NFL’s highest-paid non-quarterback.
York also did not weigh in on the 49ers’ quarterback situation — they have three backups behind Brock Purdy — but expressed confidence in coach Kyle Shanahan and general manager John Lynch to make appropriate decisions.
Source: www.mercurynews.com