Jody Godoy

(Reuters) – Robinhood Markets Inc (NASDAQ) agreed to principle settlement of a class action brought by US customers who claim that the app was unable to allow them trade on volatility related pandemics in March 2020.

On Thursday, the company sent notice to a San Francisco Federal Court about the pending agreement. It stated that it would resolve details and seek approval from the court within 60 days. Robinhood did not reveal the amount it would pay for settlement. The suit sought damages from a class representing U.S. citizens who were stockholders or option holders in connection with a March 2nd 2020 service disruption.

In addition, the lawsuit seeks to recover damages from some victims who suffered financial losses as a result of outages occurring on March 2, 3, 9, and 10, 2020.

Robinhood spokesperson refused to comment Friday.

Robinhood shares traded at $10.38 Friday afternoon. This was an increase of 11.9% over Thursday’s close.

California-based Menlo Park company, which claimed to democratize finance, saw a spike in interest from retail investors for stock trading during the pandemic. However, users have filed legal challenges claiming that the app didn’t live up its claims.

San Francisco lawsuit alleges Robinhood outages led to users losing money because they couldn’t trade. Robinhood is accused of negligence and breach of contract by users.

Robinhood placed a temporary stop to trading on January 20,21, following a rally of Gamestop Corp, AMC Entertainment and other “meme stocks”. The January class action was dismissed by a judge who ruled that such restrictions were permissible under Robinhood’s customer agreement.