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CMG BREAKING NEWS: Chipotle Mexican Grill, Inc. (NYSE:CMG) was Sued for Fraud Investors are Urged to Contact BFA Law by January 10 Court Deadline
Globe Newswire 12-Nov-2024 11:43 AM
NEW YORK, Nov. 12, 2024 (GLOBE NEWSWIRE) -- Leading securities law firm Bleichmar Fonti & Auld LLP announces that a lawsuit has been filed against Chipotle Mexican Grill, Inc. (NYSE:CMG) and certain of the Company's senior executives for potential violations of the federal securities laws.
Investors have until January 10, 2025, to ask the Court to be appointed to lead the case. The complaint asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of investors in Chipotle securities. The case is pending in the U.S. District Court for the Central District of California and is captioned Stradford v. Chipotle Mexican Grill, Inc., et al., No. 24-cv-02459.
What is the Lawsuit About?
Chipotle owns and operates more than 3,000 Chipotle Mexican Grill restaurants across the United States, Canada, and Western Europe.
The complaint alleges that in response to negative news reports accusing Chipotle of reducing portion sizes provided to customers, the Company repeatedly misrepresented that there "have been no changes in our portion sizes."
On July 24, 2024, Chipotle admitted that portion inconsistency was, in fact, a problem at the Company's restaurants and that in order to correct the inconsistent portion sizes, the Company would experience a higher cost of sales. Over the course of the next two days, July 25 and July 26, 2024, the price of the Company's stock fell 3.8%, from a closing price of $51.78 per share on July 24, 2024, to $49.83 per share on July 26, 2024.
Then, on October 29, 2024, after market hours, Chipotle revealed a 30.6% increase in its cost of sales, in part because the Company "focused on ensuring consistent and generous portions." The next day, October 30, 2024, Business Insider reported that "Profit margins for the chain suffered last quarter because of a concerted effort to provide ‘consistent and generous portions' in every order." On October 30, 2024, the price of the Company's stock fell 7.9%, from a closing price of $60.49 per share on October 29, 2024, to $55.73 per share on October 30, 2024.
If you invested in Chipotle you may have legal options and are encouraged to submit your information to the firm.
All representation is on a contingency fee basis, there is no cost to you. Shareholders are not responsible for any court costs or expenses of litigation. The firm will seek court approval for any potential fees and expenses.
Bleichmar Fonti & Auld LLP is a leading international law firm representing plaintiffs in securities class actions and shareholder litigation. It was named among the Top 5 plaintiff law firms by ISS SCAS in 2023 and its attorneys have been named Titans of the Plaintiffs' Bar by Law360 and SuperLawyers by Thompson Reuters. Among its recent notable successes, BFA recovered over $900 million in value from Tesla, Inc.'s Board of Directors (pending court approval), as well as $420 million from Teva Pharmaceutical Ind. Ltd.
