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Disclaimer: This story was originally published on May 30, 2024.

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Trading platform Robinhood has reached a settlement with investors over a lawsuit for halting the trading of certain meme stocks in 2021, a May 28 filing with a Miami federal court shows.

Lawyers for Robinhood noted that the company is “in the process of finalizing the settlement” with the group of investors, saying they anticipate completing the deal within the next two weeks.

Details about the settlement weren’t disclosed in the court filing, however.

In January 2021, Robinhood restricted transactions for several stocks, including so-called meme stocks AMC Entertainment, GameStop, BlackBerry, Koss Corporation, and Naked Brand Group, citing “significant market volatility.”

The platform’s decision to halt trading of certain stocks drew the ire of investors, including the lawsuit’s lead plaintiff Blue Laine-Beveridge, who claims the platform “unlawfully manipulated market prices” and “wiped out tens of billions of dollars of investors’ equity.”

The lawsuit against Robinhood alleges violations of securities law and is part of a broader legal action across multiple U.S. jurisdictions concerning the firm's actions related to meme stocks.

Meme stocks are shares of companies that experience a sudden surge in popularity, primarily driven by social media hype and online communities rather than traditional financial metrics. This often leads to volatile price swings as these stocks become the subject of intense discussion and speculation among retail investors.

In other news, Robinhood announced a plan on May 28 to buy back shares worth up to $1 billion over the next two to three years, commencing in the third quarter.

Share repurchases are common practices when companies believe their stock is undervalued or when they have limited opportunities to reinvest profits for growth.

Following the announcement, Robinhood’s shares rose nearly 6% in after-hours trading, contributing to a 61% increase year-to-date.