Bragar Eagel & Squire, P.C. Reminds Investors That Class Action Lawsuits Have Been Filed Against Torrid, Olaplex, Bird, and Generac and Encourages Investors to Contact the Firm
NEW YORK, Jan. 13, 2023 (GLOBE NEWSWIRE) -- Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, reminds investors that class actions have been commenced on behalf of stockholders of Torrid Holdings, Inc. (NYSE: CURV), Olaplex Holdings, Inc. (NASDAQ: OLPX), Bird Global, Inc. (NYSE: BRDS), and Generac Holdings, Inc. (NYSE: GNRC). Stockholders have until the deadlines below to petition the court to serve as lead plaintiff. Additional information about each case can be found at the link provided.
Torrid Holdings, Inc. (NYSE: CURV)
Class Period: Pursuant to the company's July 2021 IPO
Lead Plaintiff Deadline: January 17, 2023
Torrid is a direct-to-consumer brand of women's plus-size apparel and intimates. Leading up to the IPO, Torrid claimed to be experiencing rapid sales growth and an impressive recovery following a temporary downturn in the face of the initial phases of the COVID-19 pandemic, which began in March 2020.
However, as alleged in the complaint, the Registration Statement for the IPO created the misleading impression that Torrid's impressive growth trajectory was then continuing and expected to continue following the IPO. Specifically, the Registration Statement failed to disclose that the following adverse facts existed at the time of the IPO: (i) in the first half of 2021, Torrid had experienced a temporary surge in demand as a result of changed consumer behaviors in response to the COVID-19 pandemic and government stimulus and that such ephemeral demand trends had dissipated and were not internally projected to continue following the IPO; (ii) Torrid was suffering from severe supply chain disruptions caused by the emergence of the Delta variant of COVID-19, which had first emerged in May 2021; (iii) Torrid was running materially below historical inventory levels as a result of supply chain disruptions; (iv) as a result, Torrid did not have sufficient inventory to meet expected consumer demand for its fiscal third quarter of 2021; (v) as a result, late inventory arrival had materially impaired the Company from effectively matching consumer buying trends, creating an undisclosed risk of increased markdowns and promotional activities necessary to sell undesirable inventory; (vi) Torrid's CFO planned to retire shortly after the IPO; and (vii) as a result of the above, the Registration Statement's representations regarding Torrid's historical financial and operational metrics and purported market opportunities did not accurately reflect the actual business, operations, financial results, and trajectory of the Company at the time of the IPO, and were materially false and misleading and lacked a reasonable factual basis.
By the end of September 2022, the price of Torrid stock had fallen to a low of just $4.06 per share, over 80% below the IPO price.
For more information on the Torrid action go to: https://bespc.com/cases/CURV
Olaplex Holdings, Inc. (NASDAQ: OLPX)
Class Period: Pursuant to the company's September 30, 2021 IPO
Lead Plaintiff Deadline: January 17, 2023
Olaplex was founded in 2014 and is headquartered in Santa Barbara, California. Olaplex manufactures and sells hair care products. The Company offers hair care shampoos and conditioners for use in treatment, maintenance, and protection of hair. Olaplex purports to participate in the "prestige segment" of the haircare market, which the Company claims is "expected to be the fastest growing segment of the global haircare market from 2020 to 2025."
On August 27, 2021, Olaplex filed a registration statement on Form S-1 with the SEC in connection with the IPO, which, after several amendments, was declared effective by the SEC on September 29, 2021 (the "Registration Statement").
On October 1, 2021, Olaplex filed a prospectus on Form 424B4 with the SEC in connection with the IPO, which incorporated and formed part of the Registration Statement (collectively, the "Offering Documents").
Pursuant to the IPO, Olaplex issued 73,700,000 shares of its common stock to the public at the Offering price of $21.00 per share for approximate proceeds of $1,466,445,750 to the Company, after applicable underwriting discounts and commissions.
The Offering Documents were negligently prepared and, as a result, contained untrue statements of material fact or omitted to state other facts necessary to make the statements made not misleading and was not prepared in accordance with the rules and regulations governing its preparation. Specifically, the Offering Documents made false and/or misleading statements and/or failed to disclose that: (i) macroeconomic pressures and competition in the haircare market were more robust than the Company had represented to investors; (ii) accordingly, the Company was unlikely to maintain its sales and revenue momentum; and (iii) as a result, it was unlikely that the Company would be able to achieve the financial and operational growth projected in the Offering Documents; and (iv) as a result, the Offering Documents were materially false and/or misleading and failed to state information required to be stated therein.
On September 29, 2022, a Piper Sandler analyst downgraded Olaplex to Neutral from Overweight, stating that her work revealed that "competition and misinformation pose growing risks to the company." In addition, the analyst indicated that she anticipated investments in marketing and education were needed to offset the headwinds and that "little room for valuation upside given the risks at play."
On this news, Olaplex's stock price fell $1.33 per share, or 12.15%, to close at $9.62 per share on September 29, 2022.
Then, on October 18, 2022, Olaplex issued a press release in which "the Company revised its guidance for the 2022 fiscal year". Olaplex said it now expects fiscal year 2022 revenue between $704 million and $711 million, significantly down from its prior guidance range of $796 million to $826M. Olaplex stated that "[t]he Company's updated guidance primarily reflects a slowdown in sales momentum that it attributes to macro-economic pressures, increased competitive activity including discounting, and a moderation in new customer acquisition, as well as inventory rebalancing across certain customers which the Company believes are in response to these same macro-economic pressures."
On this news, Olaplex's stock price fell $5.55 per share, or 56.69%, to close at $4.24 per share on October 19, 2022.
As of the time this complaint was filed, the price of Olaplex common stock continues to trade below the Offering price of $21.00 per share, damaging investors.
As a result of Defendants' wrongful acts and omissions, and the precipitous decline in the market value of Olaplex's securities, Plaintiff and other Class members have suffered significant losses and damages.
For more information on the Olaplex action go to: https://bespc.com/cases/OLPX
Bird Global, Inc. (NYSE: BRDS)
Class Period: May 14, 2021 - November 14, 2022
Lead Plaintiff Deadline: January 17, 2023
On November 14, 2022, Bird filed attached to a Form 8-K announcing it would restate its consolidated financial statements for certain periods due to issues concerning the recognition of Sharing Revenue. In pertinent part, the press release stated:
On November 11, 2022, the Audit Committee of the Board of Directors (the "Audit Committee") of Bird Global, Inc. (the "Company"), after discussion with management, determined that (i) the Company's audited consolidated financial statements as of December 31, 2021 and 2020, and for the years then ended, and quarterly periods within those years, included in the Annual Report on Form 10-K filed with the Securities and Exchange Commission (the "SEC") on March 15, 2022, (ii) its condensed consolidated financial statements as of March 31, 2022, and for the three months then ended, included in the Quarterly Report on Form 10-Q filed with the SEC on May 16, 2022 and (iii) its condensed consolidated financial statements as of June 30, 2022, and for the three and six months then ended, included in the Quarterly Report on Form 10-Q filed with the SEC on August 15, 2022 (collectively, the "Original Filings", and each such quarterly or annual period covered therein, an "impacted period"), should no longer be relied upon. Similarly, any previously furnished or filed reports, related earnings releases, investor presentations or similar communications of the Company describing the Company's financial results contained in the Original Filings should no longer be relied upon. The determination results from an error identified in connection with the preparation of the Company's condensed consolidated financial statements as of September 30, 2022, and the three and nine months then ended, related to its business system configuration that impacted the recognition of revenue on certain trips completed by customers of its Sharing business ("Rides") for which collectability was not probable. Specifically, for certain customers with insufficient preloaded "wallet" balances, the Company's business systems recorded revenue for uncollected balances following the completion of certain Rides that should not have been recorded. The Company believes the error resulted in an overstatement of Sharing revenue in the consolidated statements of operations for the impacted periods and an understatement of deferred revenue in the consolidated balance sheets as of the end of each impacted period. The Company intends to amend the Original Filings as soon as practicable. In connection with the restatement, management has reevaluated the effectiveness of the Company's disclosure controls and procedures. Management has concluded that the Company's disclosure controls and procedures are not effective at a reasonable assurance level, due to a material weakness in its internal control over financial reporting related to the ineffective design of controls around its business systems that resulted in the recording of revenue for uncollected balances following the completion of certain Rides that should not have been recorded. The Company is in the process of designing and implementing controls to remediate these deficiencies. (Emphasis added.)
On this news, share prices of Bird plummeted $0.069 per share, or over 15%, from the prior trading date to close on November 14, 2022, at $0.364 per share, damaging investors.
As a result of Defendants' wrongful acts and omissions, and the precipitous decline in the market value of the Company's securities, Plaintiff and other Class members have suffered significant losses and damages.
For more information on the Bird class action go to: https://bespc.com/cases/BRDS
Generac Holdings, Inc. (NYSE: GNRC)
Class Period: April 29, 2021, - November 1, 2022
Lead Plaintiff Deadline: January 30, 2023
Generac is a Wisconsin-based producer of residential generators and backup power systems. In recent years, Generac expanded its business to include solar-based clean energy systems. Generac's solar offering, called the PWRcell, is a battery-based system that stores and manages electricity generated from solar panels. A critical part of the PWRcell system is the SnapRS rapid shutdown a device meant to shut off the flow of electricity from solar panels to the rest of the system. Generac sells its PWRcell systems, including the SnapRS component, primarily through independent residential dealers, known as channel partners. Those channel partners, in turn, sell or rent the product to the end consumer, providing installation and continued maintenance services for the PWRcell systems. The complaint alleges that, throughout the Class Period, Defendants made numerous materially false and misleading statements and omissions concerning the safety and success of the Company's clean power products, and the number of channel partners Generac relies on to sell, install, and service those products. Specifically, Defendants repeatedly touted to investors that safety is paramount and that the Company's solar products went through multiple rounds of design review to ensure that [they] meet all applicable internal engineering designs and safety standards . . . . Defendants also falsely represented to investors that Generac had a broad and diverse network of channel partners, and claimed that no single such partner provided more than 6% of the Company's sales. In addition, the complaint alleges that Defendants overstated the Company's earnings throughout the Class Period. Specifically, Defendants misrepresented or concealed the Company's warranty liability, and falsely assured investors that the Company's financial statements were prepared in accordance with Generally Accepted Accounting Principles. In truth, Defendants knew that, rather than ensuring the safety of its solar energy systems, Generac's SnapRS product was defective and dangerous, reducing the capacity of the solar energy systems in which it was installed, rendering costly equipment ineffective, requiring expensive maintenance, and would overheat, melt and, in some cases, start fires. Throughout the Class Period, numerous consumers filed complaints with regulators, and Generac's channel partners informed the Company of the SnapRS defect. Also, contrary to Defendants assertions, Generac's clean energy sales were heavily dependent on a single channel partner, Power Home Solar, LLC d/b/a Pink Energy (Pink Energy). Indeed, Generac faced significant undisclosed warranty liability as a result of the issues created by the SnapRS defect and resulting fallout with its largest channel partner, Pink Energy. As a result of Defendants misrepresentations and omissions, Generac common stock traded at artificially inflated prices during the Class Period. The truth began to emerge on August 1, 2022, when Pink Energy sued Generac, alleging, among other things, that Generac had provided defective components. The Pink Energy Complaint criticized Generac's failure to recall the dangerous SnapRS unit in light of Pink Energy's urging that they do so both for the sake of their business, and for the safety of their customers. Pink Energy also alleged that Generac did not disclose to Pink Energy that a firmware update, held out as a fix for the SnapRS issues, had known adverse effects and was shutting down entire PWRcell systems. In response to the serious allegations in the Pink Energy Complaint, the price of Generac shares declined by $3.31 per share. Then, on October 19, 2022, Generac published preliminary earnings showing dismal financial results for the third quarter of 2022, and announced a $55 million pre-tax charge relating to its clean energy product warranties and expenses, citing a distributor that had filed for bankruptcy. On this news, the price of Generac shares declined by $37.44 per share, or 25%. Finally, on November 2, 2022, Generac released third quarter earnings and lowered guidance on sales by its solar energy business for the remainder of the year by approximately 40%. The lowered guidance was attributed to the loss of a major customer during the quarter, along with the specific warranty-related issue i.e., the defective SnapRS component, which led to Pink Energy's bankruptcy.
In response to the November 2 disclosures, Generac common stock fell an additional $8.99 per share, or 8%.
For more information on the Generac class action go to: https://bespc.com/cases/GNRC
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Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York, California, and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.
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