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San Francisco 49ers CEO Jed York better lawyer up as he’s facing a pair of lawsuits related to insider trading and a college exam cheating scandal.
York, who is the son of 49ers owner Denise DeBartolo York, joined the organization as president when parents transitioned to the posts of co-chairmen.
He is also one of the board members on online educational tech company company Chegg.
And that is where is he is running into problems.
Lance Williams and Ron Kroichickan of The San Francisco Chronicle report that York is currently facing a pair of lawsuits.
The first alleges “insider trading and violations of federal securities laws in connection with his service on the board of a Santa Clara-based online educational company.”
The second claims that “York and other directors of Chegg Inc. stand accused of concealing the company’s role in helping college students cheat on online exams.”
The Chronicle reports that Chegg’s stock skyrocketed during the pandemic as students turned to the online resource for real-time answers to online exams.
But the suits claim that the stock prices tumbled and the company’s revenue tanked when colleges resumed in-person testing and students could no longer use the service to cheat on their exams.
“The civil suits accuse the Chegg board of ‘gross mismanagement,’ ‘unjust enrichment’ and making false and misleading statements in SEC filings in connection with Chegg’s ‘schemes’ to profit from the cheating scandal,” according to the report.
The suits also allege that York used this knowledge for insider trading purposes. The 49ers executive made $1.4 million in profit on the sale of 20,000 shares “at artificially inflated prices,” they claim.
Neither York nor the organization have comments on the suits as of the time of writing. But it’s not exactly the type of thing you want hanging over an organization as the season approaches.