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Tuesday, July 16, 2024

49ers CEO Accused Of Insider Trading Amid Chegg Controversy

  • Shareholder lawsuits make series of financial misconduct claims
  • York has long been an influential figure in NFL circles
Kirby Lee-USA TODAY Sports

A member of one of the NFL’s most prominent families is facing accusations of insider trading.

San Francisco 49ers CEO Jed York has been sued in two separate civil lawsuits in California from shareholders related to his role as a board member of educational company Chegg Inc. The company’s board and leadership have been accused of concealing its role in helping college students cheat on online exams — which ultimately became a scandal for Chegg. 

The lawsuits also allege that Chegg leadership made false and misleading statements to the U.S. Securities & Exchange Commission and dumped Chegg stock at market peaks without informing investors about the depth of the cheating scandal. 

The 49ers executive has been paid about $2 million for his part-time work on Chegg’s board and profited by $4.9 million sales of company stock — and the legal action claims that some of that money represents ill-gotten gains. 

“York engaged in insider sales before the fraud was exposed,” one of the lawsuits reads.

York is part of the York-DeBartolo clan, which has owned the 49ers since 1977, and has been an influential NFL figure, playing a key role in the development of Levi’s Stadium and the team’s acquisition of English soccer club Leeds United and serving on several critical league committees.

The company has denied the allegations. The 49ers said they are “proud” of the work done with Chegg through its foundation to provide scholarships.

Not Quite The Same

Though also centered on insider trading, this situation materially differs from that of Tottenham Hotspur owner Joe Lewis, who has been charged criminally and could be forced to sell the club.

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