Parents File Lawsuit Against Robinhood For Wrongful Death Of Son

PLAINFIELD, IL — Alexander E. Kearns, of Naperville, took his life last year after he saw that he apparently had a negative balance of $730,000 on his Robinhood account. His parents plan to file a lawsuit on Monday accusing Robinhood of wrongful death, unfair business practices and negligent infliction of emotional distress.

In a series of tweets, Bill Brewster, Kearns' cousin-in-law, revealed that Kearns was interested in investing and had opened an account on Robinhood, a trading app popular with millennials that drew extra attention this month alongside GameStop and other so-called "meme" stocks.

He "seemed to be enjoying the markets," Brewster said.

However, prior to his death, Kearns became worried about the money he owed, according to the note Brewster shared on Twitter.

In that note, written before he died, Kearns said that his account did not have a margin specified for investing — "I thought I was risking the money that I actually owned," he wrote.

The 20-year-old college student died June 12 when he was hit by a Canadian National Railway Train at the crossing on 111th Street near Cedar Road in Plainfield, police said.

"The emotional stress from the exposure caused him to take his own life," Brewster wrote.

According to the lawsuit, Robinhood, in its mission to "democratize finance for all," has been targeting young customers who have little to no experience with investing. It lures in students who are otherwise "broke" but can invest to secure their futures, according to an advertisement the company used.

Despite its desire to grow its customer base, the company failed to protect its customers, the lawsuit said. It has inadequate infrastructure and provides no customer support, especially when it experiences outages on its trading platforms.

Brewster wrote on Twitter that he does not understand how a "20-year-old with no income get[s] access to that kind of leverage" to trade with and accrue a balance of more than $700,000. Since the app does show a negative balance till the other half of the trade is completed, Brewster wrote, he believes that Alex did not actually owe that money, but it was just a "user interface issue."

Alex's parents, Dan and Dorothy, told CBS that when their son found out about the negative balance, he tried contacting Robinhood, but it had no customer service phone number. He even emailed them three times that night and the next morning asking for an explanation about what had gone wrong and how he could rectify the situation.

Dan and Dorothy believe that if a customer service agent had responded to Alex's questions, he would still be alive, CBS reported.

Following Alex's death, Vlad Tenev and Baiju Bhatt, Robinhood co-founders, wrote in a blog post that they were "personally devastated by this tragedy" and even reached out to his family to speak with them.

I saw @RobinhoodApp response and can confirm they did reach out. The family isn’t ready to speak yet. Since they can’t release account details here’s the screenshot. pic.twitter.com/uqeDhro7aJ
— Bill Brewster (@BillBrewsterSCG) June 16, 2020

The company also said in the post that it would make improvements to its user interface, in-app messages and emails that get sent to customers about options transactions, as well as make changes to the in-app history page to help users "understand the mechanics" of options trades.

Anyone struggling with mental health can get help by calling the National Suicide Prevention Lifeline at 1-800-273-8255 or texting HOME to 741741.