Robbins Geller Rudman & Dowd LLP Files Class Action Suit Against Fairway Group Holdings Corp.
NEW YORK--(BUSINESS WIRE)--Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) (http://www.rgrdlaw.com/cases/fairway/) today announced that a class action has been commenced in the United States District Court for the Southern District of New York on behalf of all purchasers of the common stock of Fairway Group Holdings Corp. (“Fairway” or the “Company”) (NASDAQ:FWM) pursuant and/or traceable to the Registration Statement issued in connection with Fairway’s April 17, 2013 initial public stock offering (the “IPO”), seeking to pursue remedies under the Securities Act of 1933 (the “Securities Act”).
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from February 14, 2014. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Samuel H. Rudman or David A. Rosenfeld of Robbins Geller at 800-449-4900 or 619-231-1058, or via e-mail at firstname.lastname@example.org. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.rgrdlaw.com/cases/fairway/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges Fairway, certain of its officers and directors and the underwriters of the IPO with violations of the Securities Act. Fairway was founded in 1933 and is headquartered in New York, New York. The Company, together with its subsidiaries, operates food retail stores in twelve locations in New York, New Jersey and Connecticut. At the time of the IPO, the Company had adopted an expansion plan it was then implementing to open hundreds of new stores to expand the Fairway chain to 300 stores nationwide.
On or about September 24, 2012, Fairway filed with the SEC a Registration Statement on Form S-1, which would later be utilized for the IPO following several amendments in response to comments by the SEC. The complaint alleges that the Registration Statement, and the documents referenced and incorporated therein, was negligently prepared and, as a result, contained untrue statements of material facts 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 complaint alleges that the Registration Statement failed to disclose and/or misrepresented the following adverse facts, among others, which existed at the time of IPO: (i) that the Company’s operating and management structure were not capable of effectively running its expanding business; (ii) that the Company had millions of dollars of redundant costs built into its budget; (iii) that competitive pricing pressure from grocery chains like Whole Foods and Trader Joe’s was negatively impacting same store sales trends and profit margins; and (iv) that the terms of a new store lease in the Chelsea section of Manhattan, were not financially viable.
Following the disclosure of multiple quarters of disappointing financial results following the IPO, several of the underwriters downgraded the Company’s stock ratings and at the time of the filing of this lawsuit, Fairway stock was trading at under $8 per share, a decline of more than 37% from the IPO price of $13.00 per share.
Plaintiff seeks to recover damages on behalf of all purchasers of Fairway common stock pursuant or traceable to the Company’s April 17, 2013 IPO (the “Class”). The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Robbins Geller represents U.S. and international institutional investors in contingency-based securities and corporate litigation. With nearly 200 lawyers in ten offices, the firm represents hundreds of public and multi-employer pension funds with combined assets under management in excess of $2 trillion. The firm has obtained many of the largest recoveries and has been ranked number one in the number of shareholder class action recoveries in MSCI’s Top SCAS 50 every year since 2003. Please visit http://www.rgrdlaw.com for more information.