The Klein Law Firm announces that a class action complaint has been filed on behalf of shareholders of Grubhub Inc. (NYSE: GRUB) who purchased shares between July 30, 2019 and October 28, 2019. The action, which was filed in the United States District Court for the Northern District of Illinois, alleges that the Company violated federal securities laws.
(i) customer orders were actually declining, despite the massive investments that the Company had made to spur demand for and use of its platform; (ii) Grubhub’s new customer additions were generating significantly lower revenues as compared to historic cohorts because these customers were more prone to using competitor platforms; (iii) Grubhub’s vaunted business model under which it secured exclusive partnerships had failed, and Grubhub needed to engage in the same aggressive nonpartnered sales tactics embraced by its competitors to generate significant revenue growth; (iv) Grubhub was required to spend substantial additional capital in order to grow revenues and retain market share in the face of heightened competitive dynamics and market saturation, eviscerating the Company’s profitability; and (v) Grubhub was tracking tens of millions of dollars below its revenue and earnings guidance and such guidance lacked any reasonable basis.
Shareholders have until January 21, 2020 to petition the court for lead plaintiff status. Your ability to share in any recovery does not require that you serve as lead plaintiff. You may choose to be an absent class member.
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