$OPEN: Rabois Calls Opendoor “Bloated,” Stock +470% YTD — But $39M Settlement Still Hangs Overhead

Court: D. Arizona

Case: 2:22-cv-01717

Opendoor’s stock has surged 470% year-to-date, fueled by retail enthusiasm and the return of co-founders Keith Rabois and Eric Wu. Now chairman, Rabois criticized the company as “bloated,” saying only 200 of its 1,400 employees are truly needed, and pledged a merit-driven overhaul. Despite the stock’s explosive rally and leadership reset, the company still faces a credibility drag from its $39M investor settlement over claims it misled shareholders about its pricing algorithm and profitability.

• 470% YTD stock surge, but -13.8% in latest session.
• Keith Rabois returns as chairman, vows sweeping job cuts.
• CEO Kaz Nejatian (ex-Shopify) to lead on-site culture shift.
• Rabois rejects remote work and DEI focus, pushes meritocracy.
• $39M settlement over pricing algorithm failures remains unresolved baggage.

Timeline Overview

• Dec 21, 2020 – Opendoor completes SPAC merger, shares debut at $31.25.
• Aug 2022 – Bloomberg reveals Opendoor lost money on 42% of home flips, worse in L.A. (55%) and Phoenix (76%).
• Sept 2022 – Analysts warn losses accelerating.
• Oct 2022 – Investors file lawsuits over misleading algorithm claims.
• 2025 – Opendoor agrees to a $39M cash settlement.

Allegations Include

• Misrepresenting the accuracy of its pricing algorithm.
• Hiding loss-making transaction volumes in key markets.
• Misleading on profitability during downturns.
• Offering overly optimistic financial guidance.

Investor Update

Opendoor OPEN has agreed to pay a $39M settlement to resolve litigation tied to its iBuying model’s misstatements. While new leadership and drastic restructuring have reignited optimism, the settlement underscores ongoing trust concerns among investors.

You can check more information about it HERE.