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Deckers Outdoor Corporation DECK Securities Lawsuit
| Company: | Deckers Outdoor Corporation |
| Ticker Symbol: | DECK |
| Class Period: | Oct-27-11 to Apr-26-12 |
| Date Filed: | Jun-1-12 |
| Lead Plaintiff Deadline: | Jul-31-12 |
| Court: | Central District of California |
| Allegations: | |
The complaint charges Deckers and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Deckers is a designer, producer, marketer, and brand manager of footwear, apparel and accessories.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements concerning the Company's financial condition and future business prospects. More specifically, defendants misrepresented and omitted material facts concerning demand for the Company's UGG brand, which is critical to its success. During the Class Period, the Company's expansion and extensive distribution created a unique circumstance: UGG supply met demand for the first time. As new product lines faltered and the Company continued raising prices on its "classic" UGG products, inventories swelled to extremely high levels, requiring the Company and its retailers to use previously unheard of mark-down and close-out pricing to move UGG products. As a result of defendants' false statements, which hid these adverse trends from the market, Deckers common stock traded at artificially inflated prices during the Class Period, reaching a high of $117.66 per share on October 28, 2011.
On February 23, 2012, the Company announced its full-year and fourth quarter 2012 financial results, reporting better-than-expected fourth quarter results, but also reporting that inventory levels had increased 100%, and that it "expects full-year diluted EPS to be approximately flat with 2011 levels." As a result, the price of Deckers common stock dropped $12.49 per share to close at $77.72 per share. Then on April 26, 2012, after the market closed, the Company announced that it had missed its second quarter 2012 earnings and lowered its full-year 2012 guidance, projecting a decrease in 2012 diluted EPS of 9%-10%, compared to previous guidance for diluted EPS to be flat year-over-year. On this news, Deckers common stock dropped again, falling $17.63 per share to close at $51.83 per share on April 27, 2012, a one-day decline of more than 25%, on volume of more than 14 million shares traded.
According to the complaint, the true facts, which were known by defendants but concealed from the investing public during the Class Period, were as follows: (a) the Company was not able to mitigate the effects of dramatically increasing prices for sheepskin; (b) the Company was seeing a decline in demand to a much larger extent than represented due to the unusually warm weather; (c) the Company's extensive expansion resulted in the over-supply of UGG products, which meant that the price increases for those products were ineffective; (d) the Company's inventory levels for its UGG brand were increasing rapidly, which led to the increased use of mark-downs and close-outs; (e) as a result of the foregoing, the Company's gross margin was negatively impacted; and (f) based on the above, defendants lacked a reasonable basis for their positive statements about the Company and its revenue outlook.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
Deckers Outdoor Corporation DECK Securities Fraud Legal Help
If you have suffered from financial losses, you may qualify for damages or remedies that may be awarded in a possible Deckers Outdoor Corporation securities class action lawsuit. Please click the link below to submit your complaint for a free evaluation.Published on Jun-1-12
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