Former United States Securities and Exchange Commission attorney Willie
Briscoe, founder of The
Briscoe Law Firm, PLLC, and the securities litigation firm of Powers
Taylor LLP announce that a federal class action lawsuit has been
filed against Fairway Group Holdings Corp. (“Fairway” or “Company”)
(NasdaqGM: FWM) and several of its officers and directors in connection
with Fairway’s April 17, 2013 initial public stock offering (“IPO”)
Registration Statement.
If you are an affected Fairway shareholder and want to learn more about
the lawsuit or join the action, contact Willie Briscoe at The Briscoe
Law Firm, PLLC, (214) 239-4568, or via email at WBriscoe@TheBriscoeLawFirm.com,
or Patrick Powers at Powers Taylor LLP, toll free (877) 728-9607, or via
email at shareholder@powerstaylor.com.
There is no cost or fee to you.
The complaint alleges Defendants violated the Securities Exchange Act of
1934 by misrepresenting and/or failing to disclose that (i) Although
Fairway’s operations had expanded exponentially, the founders’ families
continued to maintain significant operational control and had not
allowed the required structural changes to its operations or management
structure necessary to support its growth; (ii) Due to the lack of
structural or operational changes Fairway had millions of dollars of
redundant costs; (iii) Despite the Registration statement’s description,
Fairway’s CEO would suddenly and without explanation resign less than
one year following the IPO without a replacement, or a CEO succession
plan in place, causing the stock price to plummet while Fairway
scrambled to locate a CEO; (iv) Even though Fairway was increasing its
absolute sales dollars through new store openings, sales at its stores
open at least a full year were actually in decline at the time of the
IPO; (v) As the shift from small family-run stores into a larger,
corporate grocery store chain occurred, Fairway began to feel
competitive pricing pressure from other “organic” and “fresh” food
grocery chains, running down the higher prices it had once been able to
maintain as well as its profit margins; (vi) Due to pre-Super Storm
Sandy sales, Fairway’s 2012 sales had been significantly enhanced, which
was not something Fairway was on track to replicate in 2013; and (vii)
In February 2013 Fairway had signed a 20-year lease, in a space that had
experienced significant turn-over, at an inordinately high rent of $150
a square foot, very close to its competitors, which would destine this
new store to drain the Company’s financial results as its projected
sales would not support its higher operational costs. According to the
complaint, when the truth was revealed to the market, Fairway stock
plummeted approximately 37% from the IPO price.
The
Briscoe Law Firm, PLLC is a full service business litigation,
commercial transaction, and public advocacy firm with more than 20 years
of experience in complex litigation and transactional matters.
Powers
Taylor LLP is a boutique litigation law firm that handles a variety
of complex business litigation matters, including claims of investor and
stockholder fraud, shareholder oppression, shareholder derivative suits,
and security class actions.
Copyright Business Wire 2014