Alleged Fraud by AI Company

Innodata Inc. is an American company, headquartered in New Jersey, that provides business process, technology and consulting services.

A class action lawsuit has been brought against Innodata alleging securities fraud related to misrepresentation of the company’s AI technology and business prospects. The plaintiffs claim that between May 9, 2019, and February 14, 2024, the defendants made false statements or omitted key information regarding several aspects of Innodata’s AI business. These alleged falsehoods include:

  1. Viability of AI Technology: Innodata purportedly misrepresented the viability of its AI technology.
  2. Goldengate AI Platform: The Goldengate AI platform, which was highlighted as central to Innodata’s AI technology, was portrayed inaccurately. The complaint claims it was not as advanced as implied and was developed by only a small team of employees.
  3. Utilization of AI for Contracts: Innodata falsely represented its intentions to utilize AI significantly for new contracts in Silicon Valley.
  4. Investment in Research and Development for AI: Innodata misrepresented the extent of its investment in research and development for AI.
  5. Lack of Reasonable Basis for Positive Statements: Overall, the plaintiffs argue that the Innodata lacked a reasonable basis for its positive statements about its AI business, development, and financial results, as well as its growth prospects.

The lawsuit likely seeks to recover losses incurred by shareholders who were affected by the alleged securities fraud during the specified period.