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Crocs Class Action Lawsuit Claim for Fraud

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Posted: 28th January 2025
Joseph Finder
Last updated 28th January 2025
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Crocs Class Action Lawsuit Claim for Fraud.

Kessler Topaz Meltzer & Check, LLP has initiated a securities fraud class action lawsuit against Crocs, Inc. (NASDAQ: CROX) on behalf of investors who purchased or acquired Crocs common stock between November 3, 2022, and October 28, 2024, inclusive (the “Class Period”). The case, titled Carretta v. Crocs, Inc., et al., Case No. 1:25-cv-00096, is filed in the United States District Court for the District of Delaware.

Key Deadline for Investors

Investors who purchased Crocs common stock during the Class Period have until March 24, 2025, to apply to be the lead plaintiff in the case.

For more information or to file a claim, click here or copy and paste this link into your browser: https://www.ktmc.com/new-cases/crocs-inc

Alternatively, investors can contact attorney Jonathan Naji, Esq. at Kessler Topaz by calling (484) 270-1453 or emailing info@ktmc.com.

Allegations of Misconduct

The lawsuit centres around Crocs’ acquisition of HEYDUDE, a footwear brand, in February 2022. Despite the acquisition occurring mid-year, HEYDUDE’s sales accounted for roughly 25% of Crocs’ total revenue in 2022. The lawsuit alleges that Crocs misled investors about the sustainability of HEYDUDE’s revenue growth, particularly the overstocking of products to third-party wholesalers. According to the lawsuit, Crocs' management, including CEO Andrew Rees, assured investors that it would avoid overstocking practices. However, the company’s strategy led to inflated revenue numbers that did not reflect actual retail demand for HEYDUDE products.

The lawsuit claims that these misleading practices were concealed until 2023, when Crocs admitted that much of HEYDUDE’s 2022 revenue growth was driven by unsustainable inventory stocking to wholesalers. This caused Crocs’ stock price to fall sharply, with the stock price dropping by nearly 16% in one day after the admission.

The Timeline of Disclosures and Stock Price Decline

Over the course of 2023, Crocs continued to make disclosures that revealed its aggressive inventory strategy, which led to significant declines in the stock price. Key events included:

  • April 27, 2023: Crocs revealed that much of HEYDUDE’s revenue growth was unsustainable, leading to a 16% drop in stock price.
  • June 7, 2023 & July 27, 2023: Additional disclosures further disclosed Crocs’ overstocking issues, leading to further declines in stock value.
  • August 16, 2023: A downgrade by Williams Trading LLC caused Crocs’ stock price to drop nearly 4%.
  • November 2, 2023: Crocs slashed its 2023 HEYDUDE revenue growth forecast, leading to a 5% drop in stock price.
  • October 29, 2024: Crocs disclosed HEYDUDE’s underperformance, causing its stock to drop 19.2%.

What Crocs Investors Can Do

Investors who sustained significant losses from Crocs’ stock during the Class Period may seek to serve as the lead plaintiff in this class action lawsuit. The lead plaintiff acts on behalf of all class members and works with counsel to direct the litigation. If you would like to apply or receive more information, please visit this link.

CLICK HERE to sign up for the case or GO TO: https://www.ktmc.com/new-cases/crocs-inc?utm_source=PR&utm_medium=link&utm_campaign=crx&mktm=r

About Kessler Topaz Meltzer & Check, LLP

Kessler Topaz Meltzer & Check, LLP is a leading law firm that handles class actions across the globe. The firm has a strong track record of holding corporations accountable and recovering billions of dollars for investors. The firm remains committed to fighting fraud, abuse, and misconduct in the corporate world. To learn more about the firm, visit www.ktmc.com.

Contact Information

Kessler Topaz Meltzer & Check, LLP
Jonathan Naji, Esq.
280 King of Prussia Road
Radnor, PA 19087
Toll-Free: (844) 887-9500
Email: info@ktmc.com

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