SAN DIEGO, Nov. 16, 2022 (GLOBE NEWSWIRE) -- Shareholder rights law firm Johnson Fistel, LLP announces that it has filed a class action lawsuit on behalf of a class of all persons who purchased or otherwise acquired Torrid Holdings Inc. (NYSE: CURV) (“Torrid” or the “Company”) common stock pursuant and/or traceable to the registration statement and prospectus (collectively, the “Registration Statement”) issued in connection with the Company’s July 2021 initial public offering (the “IPO”). The action was filed in the United States District Court for the Central District of California and is captioned Waswick v Torrid Holdings Inc. The lawsuit charges Torrid, certain of its officers and directors, the underwriters of its IPO, and others with violations of the Securities Act of 1933.
How to Join
The Private Securities Litigation Reform Act permits any investor who is a member of the Class described above to seek appointment as lead plaintiff. A lead plaintiff acts on behalf of all other class members in directing the litigation. An investor’s ability to share in any potential future recovery is not dependent on serving as a lead plaintiff.
If you wish to seek appointment as lead plaintiff, please [click here to join], or contact lead financial analyst Jim Baker at jimb@johnsonfistel.com or 619-814-4471. If emailing, please include your phone number. There is no cost or obligation to you. Lead plaintiff motions must be filed with the court no later than 60 days from this notice.
About the Case
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.
About Johnson Fistel, LLP
Johnson Fistel, LLP is a nationally recognized shareholder rights law firm with offices in California, New York and Georgia. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits. For more information about the firm and its attorneys, please visit http://www.johnsonfistel.com. Attorney advertising. Past results do not guarantee future outcomes.
Contact:
Johnson Fistel, LLP
Jim Baker, 619-814-4471
jimb@johnsonfistel.com
