Earlier this month, the U.S. Center for Disease Control announced the end in the U.S. of the COVID-19-related public health emergency that began in March 2020. Yet even though the public health emergency has now officially ended, the pandemic’s effects still continue to affect company’s financial results, and still continue to result in COVID-19-related securities class action lawsuits. In the latest litigation example, late last week a plaintiff shareholder filed a securities class action lawsuit against The Walt Disney Company related to the fallout from the company’s early pandemic-related success with and commitment to its Disney+ streaming services, a bet that soured as the pandemic progressed. The new filing shows that though the public health emergency may have ended, the pandemic-related securities litigation risk continues.Continue Reading Disney Hit With Securities Suit with COVID-Related Allegations

Since the initial outbreak of COVID-19 in the U.S. in March 2020, there have been scores of COVID-related securities suit filed. However, as the pandemic itself progressed, the nature of the lawsuits being filed also changed. Over time, the plaintiffs’ lawyers began targeting companies that had initially prospered at the outset of the pandemic, but whose fortunes flagged as circumstances changed. The prototypical example of a COVID-19-related securities suit involving a company that experienced this particular sequence of events is the lawsuit filed against exercise equipment company Peloton, whose equipment sold briskly at the outset of the pandemic but whose sales slackened as government shutdown orders lapsed and people began returning to work. However, in a March 30, 2023 order (here), the court granted the defendants’ motion to dismiss in the Peloton case, albeit without prejudice, in a decision that does not bode well in these kinds of change-of-fortune pandemic-related securities suits.Continue Reading Dismissal Granted in Peloton COVID-Related Securities Suit

As I have noted in prior posts (most recently here), a recurring type of pandemic-related securities suit involves companies whose fortunes prospered at the outset of the pandemic but whose performance sagged as the coronavirus outbreak evolved. The latest lawsuit of this type is the securities suit filed earlier this week against the retailer Target Corp., in which the plaintiffs allege that the surge in consumer demand at the outset of the pandemic led the company to overstock inventory, causing an inventory overhang that later undercut the company’s financial performance. A copy of the March 29, 2023, complaint against Target can be found here.Continue Reading Target Hit with Securities Suit Over Pandemic-Related Inventory Overhang

Even though the COVID-19 pandemic is now into its fourth year, plaintiffs’ lawyers continue to file pandemic-related securities class action lawsuits, increasingly in conjunction with allegations involving other macroeconomic factors, such as rising interest rates, economic inflation, supply chain disruption, and labor supply shortages. In the latest example of litigation of this type, last week plaintiffs’ lawyers filed a securities class action lawsuit against tool maker Stanley Black & Decker, alleging that the company misled investors that the pandemic-fueled surge in demand for the company’s product would continue even as conditions changed. A copy of the March 24, 2023, complaint against the company can be found here.Continue Reading Stanley Black & Decker Hit with COVID-Related Securities Suit

As I noted in posts earlier this month (here and here), even though the COVID pandemic is about to enter its fourth year, COVID-related securities suits continue to be filed. The latest example is the securities class action lawsuit complaint filed late last week against pharmaceutical delivery device firm Catalent, a firm whose revenues soared at the in the early stages of the pandemic but whose fortunes lagged as the pandemic progressed. A copy of the February 24, 2023 complaint against the company can be found here.Continue Reading Pharmaceutical Delivery Device Firm Hit with COVID-Related Securities Suit

In my recent round-up of the top D&O stories of 2022, one of the stories I identified was the contribution of macroeconomic factors to the filings of securities class action lawsuits during the year. Among the macroeconomic factors I identified, beyond interest rate increases, economic inflation, and supply chain disruption, was the disruption to the labor force following, or perhaps resulting from, the pandemic. A recently filed securities suit shows how these kinds of factors can translate into securities litigation.Continue Reading Labor Supply Disruption Contributes to Recently Filed Securities Suit

       

Readers will recall that in my recent wrap-up of top D&O liability and insurance issues of 2022, I included on the list the continuing prevalence of COVID-related securities class action lawsuit filings. Now, even though the coronavirus pandemic is about to enter its fourth year, the COVID-related lawsuits continue to be filed. In the first COVID-related lawsuit filing of 2023, a plaintiff shareholder has filed a securities class action lawsuit against the vaccine development company Invivyd, Inc. (formerly known as Adagio Therapeutics, Inc.). A copy of the January 31, 2023, complaint against the company can be found here.Continue Reading First COVID-Related Securities Suit Filing of the Year      

Since the initial coronavirus outbreak in the U.S. in March 2020, plaintiffs’ lawyers have filed a host of securities class action lawsuits against companies raising a variety of COVID-19-related allegations. Many of these cases have faced significant hurdles at the initial pleading stage, and in a number of cases the dismissal motions have been granted. The one categorical exception to these dismissal motion generalizations seems to be cases involving vaccine development companies. Two rulings in the past week seem to corroborate both of these observations. First, in a December 9, 2022 ruling in the securities suit pending against the diagnostic testing company Talis Biomedical, the court granted the defendants’ motion to dismiss (albeit with leave to amend). However, in a December 12, 2022 ruling in the securities case against the vaccine development company Novavax, the court denied the defendants’ dismissal motion in significant part. The rulings in these two cases are discussed below.
Continue Reading Dismissal Motion Ruling Patterns Emerge in COVID-19-Related Securities Suits

At this point late in the year, it is looking increasingly likely that 2022 will be a down year in terms of the number of securities class action lawsuit filings relative both to recent years and even relative to long term historical norms. However, an important (and arguably somewhat surprising) part of the securities suits that were filed this year is the significant number of COVID-related securities suits filed this year. I say “surprising” because it seems unexpected well into the third year that plaintiffs’ lawyers would be continuing to file these suits. In the latest example of these kinds of suits, earlier this week a plaintiff shareholder filed a securities class action lawsuit against the pharmaceutical company Veru, Inc. related to the company’s disclosures concerning its efforts to develop a COVID-related therapy drug. A copy of the December 5, 2022 complaint filed against Veru can be found here.
Continue Reading Drug Development Company Hit With COVID-Related Securities Suit

Regular readers know that in recent months I have been following two securities class action litigation filing trends: first, the incidence of COVID-19-related securities suit filings,  and, second, the influx of claims relating to macroeconomic factors, including, among other things, global supply chain disruption (which was itself caused at least in part by the coronavirus). In a lawsuit that includes allegations that involve both of these trends, a plaintiff shareholder has filed a securities class action lawsuit against the women’s online apparel company, Torrid Holdings, Inc. As discussed below, the complaint alleges, among other things, that in connection with the company’s July 2021 IPO, the company soft-pedaled the impact on the company from COVID-19 and from supply chain disruptions. A copy of the plaintiff’s November 16, 2022 complaint can be found here.
Continue Reading Women’s Apparel Company Hit with COVID and Supply Chain-Related Securities Suit