Snap has been subject to a class action lawsuit alleging that company executives misestimated apple's privacy changes as a threat to the company's revenue streams

Social media company Snap was filed this week in a class-action lawsuit alleging that company executives had misreported Apple's privacy changes as a threat to the company's revenue streams. Snap investor Kellie Black filed a lawsuit in the U.S. District Court for the Northern District of California, saying company executives made misleading statements in regulatory documents and in the media about the impact of Apple's privacy changes on Snap's advertising business.

Specifically, Black said Snap did not disclose or misrepresent the material impact that the newly released iOS features would have on the company's revenue and ongoing impact. In addition, the plaintiffs allege that Snap exaggerated its ability to adapt to change, downplayed the risks associated with changes to Apple's operating system, and exaggerated its commitment to privacy.

Apple launched App Tracking Transparency in April, a suite of iOS features that restrict ad targeting by restricting third-party access to advertiser identification (IDFA) tags. A new guideline also requires developers to ask for consent by displaying a prompt in the initial app settings before tracking them in the app and network, which may prevent users from activating such services.

Snap warned investors that app tracking transparency could have an impact in the months leading up to its launch, but it insisted it was ready for the feature's rollout. After the feature debuted, Snap executives reported higher-than-expected ad tracking selection rates, noting integrations with Apple's IDFA recognizer alternative.

In October, however, Snap reported third-quarter revenue of $1.07 billion, about $40 million less than Wall Street's forecast. CEO Evan Spiegel blamed the results on Apple's privacy practices. The company's stock plunged in after-hours trading, dragging down the stock prices of related social media companies Facebook and Twitter, as well as digital media.

In a statement at the time, Spiegel said: "While we anticipated some degree of business disruption, the new measurement solutions offered by Apple did not scale as we expected, making it more difficult for our advertising partners to measure and manage their iOS campaigns."