The litigation targets alleged violations of the Securities Exchange Act of 1934, claiming the company failed to provide an accurate picture of its financial health. According to the complaint, management downplayed significant operational struggles, including rising costs and a softening market, while publicly overstating the resilience of their business model. These omissions reportedly left shareholders vulnerable to losses when the reality of the firm's financial position surfaced.

Brian Schall of the Los Angeles-based Schall Law Firm is overseeing the outreach to affected parties. Shareholders have until July 6, 2026, to contact the firm regarding their eligibility to participate in the litigation. As the class has not yet been certified, investors currently remain absent members of the potential suit and retain the option to take no action or seek independent representation.