Robbins Geller Rudman & Dowd LLP announces that purchasers of Torrid Holdings Inc. (NYSE: CURV) common stock in or traceable to Torrid Holdings’ July 1, 2021 initial public offering (the “IPO”) have until January 17, 2023 to seek appointment as lead plaintiff of the Torrid Holdings class action lawsuit. Captioned Waswick v. Torrid Holdings Inc., No. 22-cv-08375 (C.D. Cal.), the Torrid Holdings class action lawsuit charges Torrid Holdings, certain of its top executives and directors, the IPO’s underwriters, as well as others with violations of the Securities Act of 1933.
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CASE ALLEGATIONS: Torrid Holdings is a direct-to-consumer brand of women’s plus-size apparel and intimates. Via its IPO, Torrid Holdings sold more than 12 million shares at $21 per share, generating over $265 million in gross offering proceeds. Notably, all of the shares sold were by Torrid Holdings insiders.
Leading up to the IPO, Torrid Holdings 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 the Torrid Holdings class action lawsuit alleges, the IPO’s registration statement failed to disclose the following adverse facts: (i) in the first half of 2021, Torrid Holdings 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 Holdings 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 Holdings was running materially below historical inventory levels as a result of supply chain disruptions; (iv) thus, Torrid Holdings did not have sufficient inventory to meet expected consumer demand for its fiscal third quarter of 2021; (v) consequently, late inventory arrival had materially impaired Torrid Holdings from effectively matching consumer buying trends, creating an undisclosed risk of increased markdowns and promotional activities necessary to sell undesirable inventory; (vi) Torrid Holdings’ CFO, defendant George Wehlitz, planned to retire shortly after the IPO; and (vii) as a result, the IPO’s registration statement’s representations regarding Torrid Holdings’ historical financial and operational metrics and purported market opportunities did not accurately reflect the actual business, operations, financial results, and trajectory of Torrid Holdings at the time of the IPO, and were materially false and misleading and lacked a reasonable factual basis.
At the time of the filing of the Torrid Holdings class action lawsuit, the price of Torrid Holdings common stock remained significantly below the IPO price.
THE LEAD PLAINTIFF PROCESS: The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Torrid Holdings common stock in or traceable to the IPO to seek appointment as lead plaintiff in the Torrid Holdings class action lawsuit. A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class. A lead plaintiff acts on behalf of all other class members in directing the Torrid Holdings class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Torrid Holdings class action lawsuit. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff of the Torrid Holdings class action lawsuit.
ABOUT ROBBINS GELLER: Robbins Geller is one of the world’s leading complex class action firms representing plaintiffs in securities fraud cases. The Firm is ranked #1 on the 2021 ISS Securities Class Action Services Top 50 Report for recovering nearly $2 billion for investors last year alone – more than triple the amount recovered by any other plaintiffs’ firm. With 200 lawyers in 9 offices, Robbins Geller is one of the largest plaintiffs’ firms in the world, and the Firm’s attorneys have obtained many of the largest securities class action recoveries in history, including the largest securities class action recovery ever – $7.2 billion – in In re Enron Corp. Sec. Litig. Please visit the following page for more information:
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