The Klein Law Firm announces that a class action complaint has been filed on behalf of shareholders of Rent the Runway, Inc. (NASDAQ: RENT) who purchased Class A common stock in or traceable to the Company’s October 2021 initial public offering. The action, which was filed in the United States District Court for the Eastern District of New York, alleges that the Company violated federal securities laws.
(i) Rent the Runway was continuing to face extraordinary business headwinds, such as transportation headwinds and labor wage rate increases, from the COVID-19 pandemic; (ii) Rent the Runway's active subscriber enrollments had sharply decelerated from the growth trajectory represented in the offering documents and, as a result, Rent the Runway was several months away from approaching its pre-pandemic levels of active subscriptions; (iii) Rent the Runway needed to substantially increase marketing and advertising costs from historical figures in order to attempt to grow its active subscriber network; (iv) Rent the Runway was suffering from ballooning fulfillment and transportation costs; and (v) as a result, Rent the Runway was suffering accelerating operational losses at the time of the initial public offering and was far less likely to achieve profitability in the near term, if ever, than represented.
Shareholders have until January 13, 2023 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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