| COMPANY |
FAT Brands, Inc. |
| COURT |
United States District Court for the Central District of California |
| CASE NUMBER |
24-cv-04775 |
| JUDGE |
The Hon. Michael W. Fitzgerald |
| CLASS PERIOD |
March 24, 2022 through May 10, 2024 |
| SECURITY TYPE |
Securities |
LEAD PLAINTIFF DEADLINE IS AUGUST 6, 2024.
If you have suffered losses and would like to discuss your rights, please fill out this form or you may contact Jonathan Naji, Esq. at (484) 270-1453 or via e-mail at info@ktmc.com.
Case Background:
A class action lawsuit has been filed on behalf of those who purchased or acquired FAT Brands, Inc. (“FAT Brands”) (NASDAQ: FAT, FATBB, FATBP, FATBW) securities between March 24, 2022 and May 10, 2024, both dates inclusive (the “Class Period”).
On May 10, 2024, the United States Attorney’s Office for the Central District of California issued a press release entitled “Former CEO and Controlling Shareholder of FAT Brands Inc., Former CFO, and a Tax Advisor Indicted in Alleged Scheme to Conceal $47 million Paid to CEO in the Form of Shareholder Loans.” The press release revealed that “Andrew A. Wiederhorn, the former CEO and current controlling shareholder of [Fat Brands], has been indicted on federal charges alleging a scheme to conceal $47 million in distributions he received in the form of shareholder loans from the IRS, FAT’s minority shareholders, and the broader investing public[.]” The press release further stated that “Wiederhorn-assisted by FAT’s [CFO] and his outside accountant at advisory firm Andersen – concealed millions of dollars in reportable compensation and taxable income and evaded the payment of millions of dollars in taxes, while causing FAT itself to violate the Sarbanes-Oxley Act’s prohibition on direct and indirect extensions of credit to public-company CEOs in the form of a personal loan.”
Following this news, the price of FAT Brands Class A common stock fell by $2.08 per share, or 27.73%, to close at $5.42 on May 10, 2024. FAT Brands Class B common stock fell by $2.02 per share, or 28.85%, to close at $4.98 on May 10, 2024. FAT Brands 8.25% Series B Cumulative Preferred Stock fell by $1.08 per share, or 7.24% to close at $13.82 on May 10, 2024, and FAT Brands warrants fell by $1.05 per warrant, or 21.6%, to close at $3.80 on May 10, 2024.
The complaint alleges that, throughout the Class Period, Defendants made materially false and/or misleading statements and/or failed to disclose that: (1) Andrew A. Wiederhorn, the company’s Chairman and former CEO, had received improper payments from the company, exposing FAT Brands to criminal liability; and (2) as a result, Defendants’ statements about its business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all times.
What is a Lead Plaintiff?
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. Filling out the online form above 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.