Investors who bought Duolingo (DUOL) Class A stock between May 2, 2025 and February 26, 2026 may be covered by a proposed class action alleging Duolingo hid how heavier ads, subscription upsells and rapidly produced AI content were slowing its daily-user growth. No class has been certified and there is nothing to file yet.
Allegations Only · No Settlement Yet
This article describes a class action complaint. The statements below are unproven allegations. Duolingo, Luis von Ahn and Matthew Skaruppa have not been found liable, there is no certified class, and nothing to claim at this time. This page is informational and is not legal advice.
What Is This About?
A Michigan public pension fund filed a proposed securities class action against Duolingo on October 7, 2026, in the U.S. District Court for the Western District of Pennsylvania, where the language-learning company is based. The case is City of Dearborn Heights Act 345 Police & Fire Retirement System v. Duolingo, Inc., No. 2:26-cv-02197, assigned to Judge Christy Criswell Wiegand. Besides the company, the 32-page complaint names co-founder and CEO Luis von Ahn and former CFO Matthew Skaruppa. It alleges that while Duolingo leaned harder on ads, upsells and AI-generated lessons to make money from its users, executives told investors that growth in daily active users was healthy and durable, and played down the cost of changing course. The defendants have not yet responded in court.Free settlement alerts
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What Does the Lawsuit Allege?
Duolingo runs a “freemium” app: most learners use it free with ads, and roughly one in ten pays for Super Duolingo or the pricier, AI-powered Duolingo Max. Daily active users, or DAUs, are the metric the company’s own CEO has called probably the most important in the business. The complaint’s central claim is that Duolingo traded DAU growth for near-term revenue and did not tell investors. According to the complaint:- Free users were shown more unskippable ads and more prompts to upgrade, and paying Super subscribers were repeatedly pitched Max.
- In April 2025, Duolingo replaced its “Hearts” system with “Energy,” which drains as free users answer questions, correct or not. The company told investors Energy was “a carrot, not a stick” that lifted DAUs, time spent learning and subscriber conversion. The plaintiff says it was built to add friction and steer free users into paid plans.
- Von Ahn’s April 28, 2025 “AI-first” memo, which said Duolingo would gradually stop using contractors for work AI can handle, drew a social-media backlash, and the complaint says lesson quality slipped as AI-generated content expanded.
- Duolingo ran thousands of A/B tests, so the plaintiff argues executives could see that the added friction was slowing user growth while they described growth as strong.
The statements the complaint challenges include the first-quarter 2025 shareholder letter and call, which reported 49% DAU growth; von Ahn’s August 6, 2025 remark that the slowdown tied to his AI memo was “in the past”; and Skaruppa’s November 2025 description of a shift toward user growth as “a change of small proportion” with “a relatively small financial impact.” The complaint quotes von Ahn telling analysts in February 2026 that “the quickest way to increase monetization was basically by adding friction.” The plaintiff reads that as an admission; Duolingo has not addressed the lawsuit’s characterization in court.
The Three Stock Drops
Securities suits like this one have to tie investor losses to specific moments when the alleged truth reached the market. The complaint points to three:- November 5, 2025: Third-quarter results showed DAU growth slowing to 36%, and Duolingo said it would prioritize user growth over monetization and invest more in “teaching better.” Fourth-quarter bookings guidance came in below analyst expectations. The stock fell about 25%, or $66.28, to close at $193.74 on November 6.
- January 12, 2026: Duolingo announced Skaruppa’s resignation as CFO and gave preliminary fourth-quarter figures showing DAU growth of about 30%. The stock fell about 8.5%, from $176.66 to $161.74.
- February 26, 2026: Full-year results came with 2026 guidance of roughly 20% DAU growth, bookings growth of about 11% and an adjusted EBITDA margin near 25%. Von Ahn’s release said that “in 2026, we are deliberately prioritizing user growth and teaching better.” The stock fell 14%, or $16.45, to close at $101 on February 27.
The figures above come from the complaint. Whether those declines were caused by the alleged misstatements, rather than by ordinary business news, is a question the court has not reached.
Who Is in the Proposed Class?
The complaint defines the class as everyone who purchased Duolingo Class A common stock between May 2, 2025 and February 26, 2026, inclusive. Duolingo, von Ahn, Skaruppa, their immediate families, and the company’s officers and directors are excluded. The suit brings two claims: one under Section 10(b) of the Securities Exchange Act of 1934 and SEC Rule 10b-5 against all three defendants, and one under Section 20(a), the “control person” provision, against von Ahn and Skaruppa. It seeks compensatory damages with interest, costs and fees, and a jury trial. Duolingo’s current CFO, Gillian Munson, who took over in February 2026, is not a defendant.The plaintiff is represented by Robbins Geller Rudman & Dowd LLP and Saxton & Stump LLC. Several other firms have since published notices about the case. Docket entries show the clerk deleted a duplicate case number, 2:26-cv-02199, that was opened in error on filing day; some early notices cite that number, but the case proceeds as No. 2:26-cv-02197.
What Has Duolingo Said?
As of October 9, 2026, Duolingo had not made a public statement about the lawsuit and had not appeared in the case. Summonses were issued to all three defendants on October 8. The company’s public filings describe the 2026 shift toward user growth and teaching as a deliberate, long-term choice.What Happens Next?
Under the Private Securities Litigation Reform Act, the notice published by the plaintiff’s counsel on October 7, 2026 sets December 7, 2026 as the deadline for investors to ask the court to be appointed lead plaintiff — the investor, usually one with a large loss, who directs the case for the class. That step is optional. Under the law, an investor who does not seek lead-plaintiff status can still be part of any class the court later certifies, subject to the final class definition and any later claims process.After the court appoints a lead plaintiff and lead counsel, an amended complaint is typically filed and the defendants usually move to dismiss. Securities class actions often take years, and many are dismissed; there is no guarantee of certification, settlement or recovery. There is no settlement and no claim form today. OCA will update this page as the case develops.
Questions
Who is covered by the Duolingo securities class action?
The complaint proposes a class of everyone who purchased Duolingo Class A common stock (Nasdaq: DUOL) between May 2, 2025 and February 26, 2026, inclusive. Duolingo, the individual defendants, their immediate families and the company’s officers and directors are excluded. No class has been certified.
What is the lead plaintiff deadline in the Duolingo case?
The notice published under the Private Securities Litigation Reform Act on October 7, 2026 lists December 7, 2026 as the deadline to ask the court to be appointed lead plaintiff. Seeking that role is optional. Under the law, investors who do not seek it can still be members of any class the court later certifies.
Is there a Duolingo settlement or claim form?
No. The case was filed on October 7, 2026 and is at the complaint stage. There is no settlement, no certified class and no claim form. If the case ever settles, the court would approve a notice explaining any claim process and deadline.
What is the Energy feature mentioned in the Duolingo lawsuit?
Energy replaced Duolingo’s older Hearts system for free users in 2025. Duolingo described it to investors as rewarding and said it lifted daily users, time spent learning and subscriber conversion. The complaint alleges Energy was really designed to add friction that would push free users toward paid plans, and that the company knew from its testing that friction slows user growth.
Who are the defendants in the Duolingo stock lawsuit?
The defendants are Duolingo, Inc., co-founder and CEO Luis von Ahn, and former CFO Matthew Skaruppa, who resigned in early 2026. None of them has been found liable, and they have not yet responded to the complaint in court.
Sources
• City of Dearborn Heights Act 345 Police & Fire Retirement System v. Duolingo, Inc., No. 2:26-cv-02197 (W.D. Pa.) — docket and complaint• Duolingo — fourth-quarter and full-year 2025 results release, February 26, 2026 (SEC Form 8-K exhibit)
