LOS ANGELES–(BUSINESS WIRE)–The Law Offices of Frank R. Cruz announces that it has filed a class action lawsuit in the United States District Court for the Southern District of New York, captioned Yoon v. Malibu Boats, Inc., et al., Case No. 24-cv-3254, on behalf of persons and entities that purchased or otherwise acquired Malibu Boats, Inc. (“Malibu Boats” or the “Company”) (NASDAQ: MBUU) securities between November 4, 2022 and April 11, 2024, inclusive (the “Class Period”). Plaintiff pursues claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”).
Investors are hereby notified that they have until 60 days from this notice to move the Court to serve as lead plaintiff in this action.
If you are a shareholder who suffered a loss, click here to participate.
On February 20, 2024, before the market opened, Malibu Boats announced the Company’s Chief Executive Officer (“CEO”) had “mutually agreed” to cease to serve as CEO.
On this news, the Company’s stock price fell $4.33 or 9.1%, to close at $43.15 per share on February 20, 2024, on unusually heavy trading volume.
Then, on April 11, 2024, after the market closed, Malibu Boats revealed that Tommy’s Boats (“Tommy’s”) had filed a complaint against the Company. After the Company disclosed news of the lawsuit, various media outlets publicized the Complaint, which alleged the Company “engaged in an elaborate scheme” to “pump nearly $100 million” worth of inventory into Tommy dealerships since late 2022 to “artificially inflate Malibu’s sales performance.” According to the Complaint, Malibu Boats forced the Company’s highest priced, highest margin, slow moving “Malibu” branded inventory (as opposed to the lower-margin, but faster moving “Axis” brand) onto Tommy’s dealerships. Malibu Boats recognizes a sale when the dealer takes delivery of the boat, regardless of whether it has been sold to the end user. As a result, this scheme enabled the Company to represent that it experienced strong wholesale demand and sales, even as sales to the end user declined. The Complaint revealed that, approximately one week prior to the Company announcing the separation with Defendant Springer, certain “Malibu stakeholders” admitted to the principal of Tommy’s dealerships that Malibu was in fact “intentionally pumping Tommy’s full of inventory.” The Complaint further alleged the Company withheld payment of incentives from Tommy’s for nearly two years before suddenly cutting ties with Tommy’s.
On this news, the Company’s stock price fell $3.34, or 7.99%, to close at $38.48 per share on April 12, 2024, on unusually heavy trading volume. The Company’s common stock price continued to fall the next consecutive trading session, falling $2.34 or 6% to close at $36.14 per share on April 15, on unusually heavy trading volume.
The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that Malibu Boats engaged in an “elaborate scheme to over manufacture and pump nearly $100 million of its highest priced, highest margin, slow moving boat inventory into fifteen Tommy’s dealerships”; (2) that, as a result, the Company artificially inflated Malibu’s sales performance, market share, and stock value; (3) that the Company was withholding certain incentives and rebates from its dealers; (4) that, as a result of the foregoing, the Company faced substantial risk of litigation from one of its top dealers, Tommy’s; (5) that the Company’s CEO departed due to this role in this scheme; and (6) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
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If you purchased Malibu Boats securities during the Class Period, you may move the Court no later than 60 days from this notice to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you purchased Malibu Boats securities, have information or 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 Frank R. Cruz, of The Law Offices of Frank R. Cruz, 2121 Avenue of the Stars, Suite 800, Los Angeles, California 90067 at 310-914-5007, by email to [email protected], or visit our website at www.frankcruzlaw.com. If you inquire by email please include your mailing address, telephone number, and number of shares purchased.
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Contacts
The Law Offices of Frank R. Cruz, Los Angeles
Frank R. Cruz, 310-914-5007
[email protected]
www.frankcruzlaw.com
