Despite GameStop (GME.US) stock price falling below $20, CEO Ryan Cohen has recently become the focus of multiple legal actions. At a time when this company, once labeled as a "meme stock," faces future uncertainty, will Cohen's controversies become a new focus that distracts investors and management? Recently, the Federal Trade Commission (FTC) announced that Cohen will pay a civil penalty of $985,320 to settle charges of violating the Hart-Scott-Rodino Act (HSR Act). This act requires the reporting to federal antitrust agencies when acquiring a substantial amount of a company's stock. According to the FTC's complaint, Cohen acquired over 562,000 shares of Wells Fargo voting securities without proper disclosure, surpassing the HSR Act's filing threshold.

The FTC pointed out that although Cohen's holdings were less than 10% of the voting securities already issued, his acquisition does not qualify for the investment exemption clause of the HSR Act. The documents from the FTC mentioned that Cohen intentionally aimed to influence Wells Fargo's business decisions when acquiring shares, as evident from the emails he sent while vying for a seat on the board of directors and the communications with the bank's leadership after the acquisition.

In addition, Cohen and his company RC Ventures were sued by Bed Bath & Beyond (now a department of Beyond (BYON.US)) in August, alleging that Cohen used insider information for trading and made an illegal profit of about $47 million. The lawsuit pointed out that while serving as a director at Bed Bath & Beyond, Cohen made dozens of profitable trades of the company's stock.

Meanwhile, GameStop's management has remained silent, except for releasing financial reports and submitting documents to the U.S. Securities and Exchange Commission, as they actively devise strategies. The company revealed that as part of achieving sustained profitability, GameStop will continue to evaluate its international assets and operations to determine their strategic and financial fit, while eliminating redundant and underperforming assets. Additionally, the company has initiated a review for optimizing its store portfolio, which may result in closing more stores than in the past few years.

Some investors speculate that Cohen may have plans other than driving profits for Gamestop's traditional business. On Wednesday, Gamestop's stock price fell 2.53%, closing at $19.65, a decrease of about 70% from its 52-week high and close to the 200-day moving average of $18.74. Gamestop's all-time high closing price was $86.88 on January 27, 2021.Stock splitAdjustment).