The litigation, filed in the United States District Court for the Southern District of New York, focuses on the period between September 12, 2025, and May 12, 2026. Shareholders suffered a loss of $3.32 per share after corrective disclosures on May 13, 2026, laid bare the impact of the firm's aggressive expansion strategy. The complaint centers on Section 20(a) of the Securities Exchange Act, arguing that Davis and Booth exercised direct control over public communications and financial filings that allegedly misrepresented sales data.

Legal counsel from Levi & Korsinsky, LLP asserts that the executives, who were responsible for certifying financial reports under the Sarbanes-Oxley Act, knowingly characterized new store openings as having limited impact on existing locations. The lawsuit claims that while management presented a growth narrative to institutional investors, internal reports contradicted these statements. The court has established August 17, 2026, as the final deadline for investors to apply for lead plaintiff status. Participation in the action is handled on a contingency basis, meaning there are no upfront costs for shareholders seeking to recover losses incurred during the specified class period.