Robinhood Markets Inc. is asking the U.S. Supreme Court to hear an investor dispute stemming from its $2.1 billion initial public offering, arguing that the Ninth Circuit's decision to revive the lawsuit "exposes companies seeking to go public to expansive liability."

Robinhood's Supreme Court petition, docketed Monday, calls on the justices to determine whether publicly traded companies are required to report interim financial data in order to avoid lawsuits over new securities offerings.

Suing investors claim that the popular trading platform failed to warn them about flagging financial performance in the second quarter of 2021, which ended shortly before Robinhood notified the public of its IPO that July.

The U.S. Securities and Exchange Commission gives companies 45 days to report quarterly financial information, and so the data that investors sued over wasn't ready for publication at the time that Robinhood announced its public offering, the company said.

The Ninth Circuit's decision to reopen the lawsuit "badly misinterprets foundational disclosure requirements and is fundamentally incompatible with the SEC's quarterly reporting rules," Robinhood said. It also "exposes companies seeking to go public to expansive liability for failing to disclose intra-quarter interim data," the company said.

The company also argued in its petition that investors "have increasingly brought suits alleging that a failure to release data early violates" Section 11 of the Securities Act of 1933, which allows shareholders to sue over misstatements or omissions in registration statements.

Robinhood is asking the justices to decide whether a company can violate Section 11 by failing to report interim financial data.

Shareholders first brought the case in December 2021, accusing Robinhood, its executives and its underwriters of misleading them and others about the strength of its business, since the strong performance was heavily intertwined with trading of the cryptocurrency token dogecoin and other so-called meme stocks.

They argue that Robinhood knew that the hype for its trading application wouldn't last, as shown by the company's then-unreleased second-quarter report. After the report was released, the company's stock price dropped 82% from its IPO price, according to investors.

Robinhood told the Supreme Court that its stock currently trades for well above its IPO price, but that it could suffer "billions in damages" if the investors win.

U.S. District Judge Edward M. Chen dismissed the case in January 2024, saying that shareholders' allegations "do not reflect results so extraordinary as to warrant out-of-quarter disclosure."

But a divided Ninth Circuit revived some claims, with the majority ordering the district court to "ascertain whether plaintiffs adequately alleged that the omitted information was material."

"If they did, then they have adequately alleged that Robinhood had a duty to disclose the omitted information," the appellate court said.

Dissenting from the majority, U.S. Circuit Judge Johnnie Rawlinson said Robinhood did disclose to investors that it expected a possible slowdown in the latter half of 2021 and warned that the use of its platform could fluctuate from quarter to quarter.

Shareholder attorneys didn't immediately respond to a request for comment Tuesday.

Robinhood is represented by Kevin Orsini, Antony Ryan and Brittany Sukiennik of Cravath Swaine & Moore LLP and Jeffrey Wall, Yaira Dubin and Robert Flatow of Sullivan & Cromwell LLP.

The investors are represented by Thomas Laughlin, Hal Cunningham, John Jasnoch and Emilie Kokmanian of Scott + Scott Attorneys at Law LLP.

The case is Robinhood Markets Inc. et al v. Sodha, case number 25-944, before the U.S. Supreme Court.