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RDFN.US
id: 1596
Redfin ($RDFN) Misleading Merger Proxy and Undisclosed Conflicts Case
Investors can submit applications for the lead plaintiff role.
W.D. Washington
Court2:25-cv-00883
Case number03/10/2025
Class period Start05/09/2025
Class period End07/08/2025
Lead Plaintiff motion deadline- $RDFN investors filed a claim against Redfin for approving a merger with Rocket Companies while hiding conflicts of interest and key financial inputs.
- Ahead of a June 2025 shareholder vote, Redfin investors claim they were misled by an incomplete and misleading proxy statement.
Case Details:
On March 9, 2025, Redfin announced it would merge with Rocket Companies in an all-stock transaction. Shareholders would receive 0.7926 shares of Rocket Class A stock for each Redfin share. Redfin stock would cease trading once the merger closed.
Redfin issued a proxy statement to support the deal on May 5, 2025, urging shareholders to vote in favor of the merger on June 4, 2025. The proxy included a fairness opinion from Goldman Sachs, Redfin’s financial advisor, but failed to disclose that Goldman had an ongoing lending relationship with Rocket, creating a serious potential conflict of interest. The amount of Rocket’s debt funded by Goldman, and the fees Goldman was earning from Rocket, were not disclosed.
The proxy also failed to explain key inputs used by Goldman in its discounted cash flow (DCF) analysis, such as assumptions for Redfin’s beta, market metrics, and the full impact of Redfin’s tax assets. These missing details affected Goldman’s valuation range and may have artificially lowered Redfin’s perceived value.
Together, these omissions left shareholders without the information needed to fairly evaluate whether the merger terms were reasonable—or whether the deal was being influenced by undisclosed conflicts.
Based on these events, $RDFN investors filed a claim against Redfin, its board, and financial advisor Goldman Sachs, accusing them of the following:
- It misled shareholders by omitting key facts about conflicts of interest in the merger process.
- It failed to disclose critical valuation details used to justify the fairness of the deal.
Considering all the representations, investors believe Redfin did not give shareholders enough information to make an informed vote on a deal that will eliminate their shares.
Case Status
Lead Plaintiff Submission
Alleged Offence
Mismanagement,
Misleading Statements,
Omissions
Suspected Party
Directors,
Management
Security Type
Stocks
Trade Direction
Long
Shock Event Date
05/05/2025
Filing date
05/09/2025
Lead Plaintiff Deadline
07/08/2025