While there have been dramatic developments in recent days related to the Trump administration’s tariff-policies – including the U.S. Supreme Court striking down the administration’s IEEPA tariffs and the Trump administration announcement of new across-the-board Section 122 tariffs – the uncertainty companies have faced related to the tariffs continues, and indeed may even have been exacerbated. A new securities suit filed earlier this week against Lakeland Industries, a company whose operations and financial results were impaired by “tariff headwinds,” illustrates how the continuing tariff uncertainty may translate into corporate and securities litigation in the weeks and months ahead. A copy of the February 23, 2026, Lakeland Industries complaint can be found here.

Background

Lakeland manufactures and sells protective clothing for industrial uses. The company employs a “small, strategic, and quick” (SSQ) mergers and acquisitions strategy to try to grow revenues. In 2023 and 2024, the company acquired businesses in New Zealand (“Pacific Helmets”), as well as in Italy and Romania (collectively, “Jolly).

According to the subsequently filed securities class action complaint, the company represented to investors that it would realize substantial benefits from its acquisitions strategy. Following the onset of tariff-related market uncertainties in 2025, the Company, the complaint alleges, said that it was “well-positioned to weather the tariff-related headwinds while continuing to pursue its SSQ M&A strategy.” The complaint further alleges that “throughout the Class Period, notwithstanding tariff-related headwinds, Defendants made repeated assurances regarding their visibility into Lakeland’s future performance in upcoming quarters, consistently expressing confidence in their financial guidance.”

In providing guidance in April 2025, the defendants, according to the complaint, communicated that “notwithstanding tariff-related uncertainties, they had visibility into Lakeland’s future performance by virtue of various purported positive market signals they observed and their widely touted tariff mitigation measures.”

In July 2025, when the company announced results falling short of prior guidance as a result of “shipment timing” and “tariff-related delays,” the company cited “elevated freight costs resulting from tariff-related inventory build,” among other things. The company’s share price declined.

In September 2025, when the company again announced disappointing results, the company cited, among other things, “continued delays in purchasing decisions due to tariff uncertainty.” The company’s share price declined further on this news.

In December 2025, the company again reported disappointing results, due, among other things, to “tariff headwinds.” The company also withdrew its prior guidance because the challenges “have affected our forecasting ability.” That same day the company announced that its CFO’s employment had been terminated. The company’s share price declined nearly 40% on this news.

The Lawsuit

On February 23, 2026, a plaintiff shareholder filed a securities class action lawsuit in the Southern District of New York against the company and certain of its directors and officers. The complaint purports to be filed on behalf of investors who purchased the company’s shares between December 1, 2023, and December 9, 2025.

The complaint alleges that during the class period the defendants made false or misleading statements or failed to disclose that: “(i) Lakeland was experiencing significant sustained issues with its Pacific Helmets and Jolly businesses, including, inter alia, shipping-related delays, production issues, and slower than expected rollout of new products; (ii) accordingly, Defendants overstated the anticipated and actual positive impact of their businesses on Lakeland’s financial results, as well as the overall strength and quality of Pacific Helmets’ and Jolly’s respective operations; (iii) Lakeland’s business and financial results were significantly deteriorating because of, inter alia, tariff-related headwinds and timing, certification delays, and material flow issues in its acquired businesses; (iv) accordingly, Defendants overstated the strength of their tariff mitigation measures and SSQ M&A strategy; (v) as a result of all of the foregoing issues, Defendants’ financial guidance was unreliable; and (vi) as a result, Defendants’ public statements were materially false and misleading at all relevant times.”

The complaint alleges that the defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint seeks to recover damages on behalf of the plaintiff class.

Discussion

Since the Liberation Day tariffs were first announced in April 2025, business conditions related to the tariffs has been characterized by uncertainty, as the announced tariffs have been abruptly changed, increased, or altered. The tariff-related impacts and business uncertainties have in at least some cases led to securities class action lawsuit filings, as discussed, for example, here and here.

The most recent tariff-related developments – including the Supreme Court’s decision striking down the IEEPA tariffs, and President Trump’s subsequent announcement of different, across-the-board but temporary tariffs — magnify the uncertainty.

This complaint demonstrates how tariff-related uncertainties can hamstring a company, as well as how tariff-related “headwinds” can exacerbate business challenges a company is otherwise facing. The factual allegations also show how unanticipated tariff-related developments can cast prior tariff related statements into a harsh light, particularly when viewed with the benefit of hindsight.

The recent tariff-related developments, including the U.S. Supreme Court’s decision, do nothing to alter these challenging business operating conditions. If anything, as noted above, the recent developments add to the uncertainty. The ongoing and new tariffs will pose many of the same challenges as this company faced under the circumstances alleged here. And like the company here, companies that are already facing other businesses challenges will find their challenges magnified by the tariff-related uncertainty.

It is unclear what may lie ahead for the Trump administration’s tariffs, especially since the latest round of Section 122 tariffs are temporary (because subject to a 150-day time limit). What does seem clear is that the kind of uncertainty this company experienced seems likely to continue to affect many businesses going forward. In at least some cases, it seems likely that tariff-related headwinds and setbacks will not only affect operating performance and financial results but may also translate into corporate and securities litigation. It seems likely that as companies struggle to deal with tariff headwinds and uncertainty, we will see further tariff-related corporate and securities litigation.