NEW YORK, Dec. 23, 2022 (GLOBE NEWSWIRE) -- Bragar Eagel & Squire, P.C., a nationally recognized stockholder rights law firm, reminds investors that a class action lawsuit has been filed against FIGS, Inc. (“FIGS” or the “Company”) (NYSE: FIGS) in the United States Central District of California on behalf of all persons and entities who purchased or otherwise acquired FIGS securities between May 27, 2021 and May 12, 2022 and pursuant to the May 27, 2021 IPO and/or Pursuant to the September 16, 2021 SPO, both dates inclusive (the “Class Period”). Investors have until January 3, 2023 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
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Founded in 2013, FIGS is a direct-to-consumer healthcare apparel and lifestyle brand that primarily sells its products in the United States through the Company’s digital platforms. While FIGS is best known for its medical scrubs, it also offers other healthcare apparel including lab coats, outerwear, activewear, loungewear, compression socks, footwear, and masks.
On June 1, 2021, FIGS announced the closing of its IPO. Pursuant to the IPO Offering Materials (as defined herein), Defendants issued to the public 30,344,317 shares of FIGS Class A common stock, including the full exercise of the underwriters’ option to purchase an additional 3,957,954 shares, at a price of $22 per share. Of those shares, FIGS sold 4,636,364 shares, and the remaining 25,707,953 shares were sold by Tulco, LLC (“Tulco”), the Company’s largest stockholder.
All sales were issued pursuant to the IPO Offering Materials. However, the IPO Offering Materials and documents incorporated by reference therein contained untrue statements of material fact and omitted to state material facts that were required by applicable law and necessary to make the statements therein not misleading. In particular, the IPO Offering Materials stated that the Company’s Direct-to-Consumer (“DTC”) strategy provides “valuable real-time customer data” that “leads to operational efficiencies throughout our supply chain, inventory management and new product development.”
On September 14, 2021, FIGS issued a press release announcing the SPO, through which Defendants Tulco, Heather Hasson (“Hasson”), and Catherine Spear (“Spear”) would offer for sale approximately 8.8 million shares of FIGS Class A common stock.
On September 20, 2021, Defendants Tulco, Hasson, and Spear completed the SPO. Pursuant to the SPO Offering Materials (as defined herein), Defendants Tulco, Hasson, and Spear issued to the public 8,917,385 shares of FIGS Class A common stock, including the full exercise of the underwriters’ option to purchase an additional 1,337,607 shares, at a price of $40.25 per share.
All sales in the SPO were issued pursuant to the SPO Offering Materials. However, the SPO Offering Materials and documents incorporated by reference therein contained untrue statements of material fact and omitted to state material facts that were required by applicable law and necessary to make the statements therein not misleading. In particular, the SPO Offering Materials reiterated that the Company’s access to significant customer data led to “operational efficiencies throughout [its] supply chain [and] inventory management.” The SPO Offering Materials also stated that the Company’s DTC strategy allowed FIGS to leverage customer data “in all aspects of our business, including apparel design and merchandising, customer acquisition and retention, demand forecasting and inventory optimization.”
The truth began to be revealed on December 10, 2021, before the market opened, when FIGS announced that its Chief Financial Officer (“CFO”) Jeffrey D. Lawrence, would be resigning effective December 24, 2021, less than one year after becoming CFO. In response to this news, the price of FIGS stock declined by $6.57 per share, or over 21%, from a closing price of $31.22 per share on December 9, 2021, to a closing price $24.65 per share on December 10, 2021, on unusually high trading volume.
Then, on May 12, 2022, after the market closed, FIGS announced disappointing financial results and slashed its expected sales, gross margin, and adjusted earnings before interest, taxes, depreciation, and amortization (“EBITDA”). FIGS attributed the poor financial results to “inventory constraints” which the Company stated were “the primary factor affecting our outlook for the full year.” In response to this news, the price of FIGS stock declined by $3.21 per share, or nearly 25%, from a closing price of $12.85 per share on May 12, 2022, to a closing price of $9.64 per share on May 13, 2022, on unusually high trading volume.
As a result of Defendants’ wrongful acts and omissions, and the resulting decline in the market value of FIGS stock, Plaintiff and other Class members have suffered significant losses and damages.
If you purchased or otherwise acquired FIGS shares and suffered a loss, are a long-term stockholder, have information, would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Brandon Walker or Melissa Fortunato by email at investigations@bespc.com, telephone at (212) 355-4648, or by filling out this contact form. There is no cost or obligation to you.
About Bragar Eagel & Squire, P.C.:
Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York, California, and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.
Contact Information:
Bragar Eagel & Squire, P.C.
Brandon Walker, Esq.
Melissa Fortunato, Esq.
(212) 355-4648
investigations@bespc.com
www.bespc.com
