The Klein Law Firm announces that a class action complaint has been filed on behalf of shareholders of Torrid Holdings Inc. (NYSE: CURV) who purchased common stock in or traceable to the Company’s July 2021 initial public offering. The action, which was filed in the United States District Court for the Central District of California, alleges that the Company violated federal securities laws.
In particular, the Torrid lawsuit alleges that (i) in the first half of 2021, Torrid had experienced a temporary surge in demand as a result of changed consumer behaviors in response to the COVID-19 pandemic and government stimulus and that such ephemeral demand trends had dissipated and were not internally projected to continue following the initial public offering ("IPO"); (ii) Torrid was suffering from severe supply chain disruptions caused by the emergence of the Delta variant of COVID-19, which had first emerged in May 2021; (iii) Torrid was running materially below historical inventory levels as a result of supply chain disruptions; (iv) as a result, Torrid did not have sufficient inventory to meet expected consumer demand for its fiscal third quarter of 2021; (v) as a result, late inventory arrival had materially impaired the Company from effectively matching consumer buying trends, creating an undisclosed risk of increased markdowns and promotional activities necessary to sell undesirable inventory; (vi) Torrid’s Chief Financial Office planned to retire shortly after the IPO; and (vii) as a result of the above, representations made in the Company's registration statement regarding Torrid’s historical financial and operational metrics and purported market opportunities did not accurately reflect the actual business, operations, financial results, and trajectory of the Company at the time of the IPO, and were materially false and misleading and lacked a reasonable factual basis.
Shareholders have until January 17, 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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