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Kessler Topaz Meltzer & Check, LLP: Investor Class Action Filed Against MGP Ingredients, Inc. for Securities Fraud Violations

Notice is hereby given that a class action lawsuit has been filed on behalf of those who purchased or otherwise acquired MGP Ingredients, Inc. (“MGP”) (Nasdaq: MGPI) common stock between February 27, 2019 and February 25, 2020, inclusive (the “Class Period”). 

MGP investors may receive additional information about the case by clicking the link "Submit Your Information" above.


According to the complaint, MGP is a leading producer and supplier of premium distilled spirits and specialty wheat protein and starch food ingredients. Distilled spirits include premium bourbon and rye whiskeys. Beginning in 2015, MGP embarked on a new strategy in its whiskey line of business. Instead of selling MGP’s whiskey as an unaged new distillate, which was then barreled and aged by MGP’s customers, MGP started storing significant amounts of barreled distillate that it could later sell as aged whiskey. After four years of aging, MGP anticipated selling this aged whiskey in 2019, which analysts and investors eagerly anticipated as tapping a new market demand. MGP stated that it expected its four-year-old whiskey to fetch three times the price of unaged whiskey and was looking to lock in customers to long-term contracts.  The Class Period commences on February 27, 2019, when MGP announced its fiscal year 2018 financial results and its outlook for fiscal year 2019. The defendants stated that MGP was on track for strong growth due to its ready-to-sell aged whiskey inventory and “higher-than-expected” customer demand. The defendants also told investors that MGP had already begun to reap significant benefits from its aged whiskey strategy, claiming that MGP had “already transacted” and entered into contracts for the sale of aged whiskey on favorable terms and that past and ongoing transactions had laid the foundation for favorable sales throughout the year.

According to the complaint, on May 1, 2019, MGP issued a press release announcing disappointing financial results for the first quarter 2019. The press release stated that MGP’s financial results were “lighter” than consensus. The defendants blamed the weak results on the “timing” of certain sales. Following this news, the price of MGP’s stock declined nearly 23%, from a close of $87.87 per share on April 30, 2019, to a close of $67.79 per share on May 1, 2019.  Then, on January 17, 2020, MGP pre-announced its preliminary fiscal year 2019 results, which significantly missed the guidance that the defendants had reiterated with just two months remaining in fiscal year 2019.  Following this news, the price of MGP’s stock declined more than 27%, from a close of $52.78 per share on January 16, 2020 to a close of $38.18 per share on January 17, 2020.

Finally, on February 26, 2020, MGP issued a press release announcing its finalized fiscal year 2019 financial results, which missed guidance on all metrics. The defendants attributed the disappointing results to MGP being “unsuccessful in transacting a large portion of the aged whiskey sales . . . forecast for the fourth quarter.” MGP also announced that it was reducing its expectations for aged whiskey sales going forward.  On February 26, 2020, MGP held a conference call for analysts and investors to discuss the results. On the call, MGP announced its finalized full-year 2019 financial results, confirming its previously announced preliminary results, including that it had fallen “significantly short of . . . guidance” due to its failure to sell aged whiskey during the fourth quarter of 2019. MGP also revealed that aged whiskey sales had declined year over year and that it had failed to secure the contracts it had previously highlighted to investors.  Following this news, the price of MGP’s stock declined 11%, from a close of $31.80 per share on February 25, 2020 to a close of $28.42 per share on February 26, 2020.

The complaint alleges that, throughout the Class Period, the defendants made false and/or misleading statements and/or failed to disclose that: (a) MGP had not completed any significant sales of its four-year-old aged whiskey inventory; (b) MGP had been unable to sell its aged whiskey at the price premium represented to investors; (c) a glut of aged whiskey inventory and shifts in consumer behavior lowered the value of MGP’s aged whiskey inventory and materially impaired its ability to negotiate significant sales on favorable contract terms; and (d) MGP’s financial forecast lacked a reasonable basis and was materially misleading. 

If you are a member of the class described above, you may no later than April 28, 2020 move the Court to serve as lead plaintiff of the class, if you so choose.


A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Returning the attached form or communicating with any counsel is not necessary to participate or share in any recovery achieved in this case.  Any member of the purported class may move the court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.

Kessler Topaz Meltzer & Check, LLP has not filed a complaint in this matter.  If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Kessler Topaz Meltzer & Check, LLP toll free at 1-844-887-9500 or 1-610-667-7706, or via e-mail at info@ktmc.com. If you would like additional information about the suit, please click on the link "Submit Your Information" above and fill out the form as promptly as possible.

CONTACT:
Kessler Topaz Meltzer & Check, LLP
James Maro, Esq. or Adrienne Bell, Esq.
280 King of Prussia Road
Radnor, PA 19087
1-844-887-9500 (toll free) or 1-610-667-7706
Or by e-mail at info@ktmc.com

Please complete this form relating to your transactions for MGP Ingredients, Inc. (Nasdaq: MGPI) common stock between February 27, 2019 and February 25, 2020, inclusive (the “Class Period”).  

You may also contact James Maro, Jr., Esq. or Adrienne Bell, Esq. at 610.667.7706 or toll free at 844.887.9500, or you may submit your information via email at info@ktmc.com, or you may click here to print a PDF of this form.

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The submission of this form does not create an attorney-client relationship, nor an obligation on the part of Kessler Topaz or you to file a lead plaintiff motion in this matter. Any information you submit will be maintained as confidential. If Kessler Topaz, in its sole discretion, believes that you might be an appropriate lead plaintiff candidate, Kessler Topaz will contact you to discuss the matter and whether to establish an attorney client relationship. By signing this form you are authorizing us to contact you regarding this case and/or future cases.
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