RH has a convenient defense already "but but but we had to comply with the law!" We know it's BS, we know that there's obviously more than that behind the move, but technically it holds ground https://www.reuters.com/article/us-retail-trading-robinhood-liability-an-idUSKBN29Z0HI At least a dozen proposed class action lawsuits accuse Robinhood of breaching its contract with customers when it restricted trading on Thursday. Robinhood’s users were at the center of this week’s wild rally in a handful of stocks that had been heavily shorted by hedge funds and championed by individual investors in online chatrooms including Reddit’s WallStreetBets. The lawsuits, brought in federal court, allege that the Menlo Park, California-based company breached its contractual obligation as a regulated broker to execute orders promptly and effectively. **However, Robinhood is not legally bound to carry out every trade and the lawsuits will not succeed without evidence the company restricted trading for an improper reason, such as to favor certain investors, according to several legal experts.** The user agreement on Robinhood’s website says it “may at any time, in its sole discretion and without prior notice to Me, prohibit or restrict My ability to trade securities.” Adam Pritchard, a professor at the University of Michigan Law School, said the lawsuits are very unlikely to gain traction. “The contract says they can do it,” Pritchard said of the company’s decision to restrict trading. “That seems to be a big stumbling block to the breach of contract claim.” Robinhood did not immediately respond to a request for comment. The popular commission-free trading platform had branded itself as an app to empower retail investors to take on Wall Street and democratize finance, and the trade restrictions sparked an uproar and claims of betrayal on social media. **Robinhood said the restrictions were necessary to comply with regulatory capital requirements and clearinghouse deposits, which it said fluctuate with volatility.**