NEW YORK, NY – After a less-than-spectacular Initial Public Offering, perhaps marred by bad timing, and the subsequent two months that have seen the company’s stock decline precipitously, a group of Blue Apron investors has filed suit against the company.
The class action lawsuit, filed by Bragar Eagel & Squire on behalf of a group of investors, was announced last weekend in a press release from the law firm.
According to the press release, the complaint alleges that Blue Apron’s Registration Statement in connection with the IPO failed to disclose a number of significant items. The complaint alleges that Blue Apron failed to disclose plans to significantly reduce spending on advertising in Q2 2017, hurting sales and profit margins in future quarters. The suit also alleges that Blue Apron neglected to note that the company was experiencing difficulty with customer retention due to orders not arriving on time or with all expected ingredients, and that the company was experiencing delayed orders in Q2 2017 related to its new factory in Linden, New Jersey.
Since its IPO, the law firm notes, Blue Apron shares have fallen $4.70, or 47 percent, to close at $5.30 per share on August 18, 2017.
This isn’t the first time investors have explored the potential of filing suit against the meal kit provider. As early as late-July, we reported that some law firms and shareholder groups were exploring the possibility of filing suit for breach of fiduciary duty. In fact, Grub Street reports, as many as four separate class action suits are currently underway, all making nearly identical allegations.
Recently, Blue Apron has made a number of efforts to trim costs and continue its growth strategies. AndNowUKnow will continue to report.
