The legal action, filed in the United States District Court for the Western District of Pennsylvania, centers on the period between September 8, 2025, and August 24, 2026. Shareholders allege that management misled the market regarding the health of its $2.5 billion Foot Locker acquisition. While executives previously touted growth projections of 1.5% to 3%, the company ultimately revised its outlook to a range of negative 2.0% to 0.0%, citing an increasingly promotional footwear market and an over-reliance on legacy inventory.

On August 25, 2026, the company’s stock price plummeted from $179.33 to $124.31 per share after management reduced its full-year net sales guidance to a range of $21.9 billion to $22.2 billion. The lawsuit contends that the challenges cited for this decline were present at the time the company was offering optimistic forecasts to investors. Levi & Korsinsky, LLP, which is representing the class, notes that eligibility for potential recovery is determined by purchase dates during the class period, regardless of whether the investor currently holds the shares.