FAT Brands Inc (NASDAQ: FAT) Investor Securities Class Action Lawsuit

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Company Name(s): 
FAT Brands
Case Name: 
FAT Brands Shareholder Class Action Lawsuit
Case Status: 
Lawsuit Filed
Affected Securities
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action

An investor, who purchased shares of FAT Brands Inc (NASDAQ: FAT), filed a lawsuit over alleged violations of Securities Laws by FAT Brands Inc in connection with the company’s initial public offering (“IPO”).

Beverly Hills, CA based FAT Brands Inc. is a restaurant franchising company that develops, markets, and acquires fast casual restaurant concepts around the world. As of March 26, 2017, the Company operated the Fatburger, Buffalo’s Cafe and Buffalo’s Express restaurant concepts. FAT Brands Inc went public in October 2017 and shares of FAT Brands Inc (NASDAQ:FAT) reached in the open market as high as $11.99 per share on October 26, 2017. In late December 2017, FAT Brands Inc (NASDAQ:FAT) shares declined to as low as $7.52 per share.

According to the complaint the plaintiff alleges, that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that at the time of the IPO, FAT Brands Inc failed to disclose that the Company’s free cash flow was insufficient to cover its dividend, and that its sales growth had declined markedly.