PDF

FAT Brands Inc. Class Action Lawsuit - FAT

Company Name
FAT Brands Inc.
Stock Symbol
FAT; FATBB; FATBP; FATBW
Class Period
December 4, 2017 to February 18, 2022
Court
Central District of California

Case Summary

The FAT Brands class action lawsuit seeks to represent purchasers of FAT Brands Inc. (NASDAQ: FAT; FATBB; FATBP; FATBW) securities between December 4, 2017 and February 18, 2022, inclusive (the “Class Period”) and charges FAT Brands and certain of its top executive officers with violations of the Securities Exchange Act of 1934.  The FAT Brands class action lawsuit was commenced on March 18, 2022 in the Central District of California and is captioned Matthews v. FAT Brands Inc., No. 22-cv-01820.

If you suffered significant losses and wish to serve as lead plaintiff of the FAT Brands class action lawsuit, please provide your information by clicking here.  You can also contact attorney J.C. Sanchez of Robbins Geller by calling 800/449-4900 or via e-mail at jsanchez@rgrdlaw.com.  Lead plaintiff motions for the FAT Brands class action lawsuit must be filed with the court no later than May 17, 2022.

CASE ALLEGATIONS: FAT Brands purports to be a franchising company which acquires, develops, and markets quick-service, fast casual, and casual dining restaurant concepts including the brands of: Fatburger, Johnny Rockets, Twin Peaks, Fazoli’s, Buffalo’s Cafe, Buffalo’s Express, Ponderosa Steakhouse, Bonanza Steakhouse, Hurricane Grill & Wings, Yalla Mediterranean, and Elevation Burger.

The FAT Brands class action lawsuit alleges that, throughout the Class Period, defendants made false and misleading statements and failed to disclose that: (i) FAT Brands and defendant Andrew Wiederhorn and/or his son Thayer Wiederhorn engaged in transactions “for no legitimate corporate purpose”; (ii) FAT Brands ignored warning signs relating to transactions with the Wiederhorns; (ii) as a result, FAT Brands was likely to face increased scrutiny, investigations, and other potential issues; (iv) certain executives, who are touted as critical to FAT Brands’ success, were at great risk of scrutiny – potentially, at least in part, due to FAT Brands’ actions; (v) FAT Brands’ touted CEO and COO were under investigation regarding transactions with FAT Brands; and (vi) as a result, defendants’ public statements were materially false and/or misleading at all relevant times.

On Saturday February 19, 2022, the Los Angeles Times published an article entitled “Family behind Fatburger under investigation for alleged fraud, money laundering, records show” which revealed the investigations into FAT Brands’ CEO, defendant Wiederhorn, and his son and FAT Brands’ COO Thayer Wiederhorn in connection with FAT Brands.  The article revealed that: “Federal authorities have been investigating Andrew Wiederhorn, chief executive of the company that owns the Fatburger and Johnny Rockets restaurant chains, and examining one of his family member’s actions as part of an inquiry into allegations of securities and wire fraud, money laundering and attempted tax evasion, court records show.”  The article further reported that: “In a November affidavit outlining the investigation, a special agent for the FBI focusing on complex financial crimes alleged that Wiederhorn, 56, had ‘devised and executed a fraudulent scheme’ to avoid paying taxes and received ‘millions of dollars in sham loans’ through his companies.”

Then, on February 22, 2022, FAT Brands announced that “the U.S. Attorney’s Office for the Central District of California (the ‘U.S. Attorney’) and the U.S. Securities and Exchange Commission informed [FAT Brands] in December 2021 that they have opened investigations relating to the Company and our [CEO], Andrew Wiederhorn, and are formally seeking documents and materials concerning, among other things, [FAT Brand]’s December 2020 merger with Fog Cutter Capital Group Inc., transactions between these entities and Mr. Wiederhorn, and compensation, extensions of credit and other benefits or payments received by Mr. Wiederhorn or his family.”  On this news, the price of FAT Brands’ securities fell, damaging investors.

THE LEAD PLAINTIFF PROCESS: The Private Securities Litigation Reform Act of 1995 permits any investor who purchased FAT Brands securities during the Class Period to seek appointment as lead plaintiff in the FAT Brands class action lawsuit.  A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class.  A lead plaintiff acts on behalf of all other class members in directing the class action lawsuit.  The lead plaintiff can select a law firm of its choice to litigate the class action lawsuit.  An investor’s ability to share in any potential future recovery of the class action lawsuit is not dependent upon serving as lead plaintiff.

ABOUT ROBBINS GELLER RUDMAN & DOWD LLP: Robbins Geller Rudman & Dowd LLP is one of the world’s leading complex class action firms representing plaintiffs in securities fraud cases.  The Firm is ranked #1 on the 2021 ISS Securities Class Action Services Top 50 Report for recovering nearly $2 billion for investors last year alone – more than triple the amount recovered by any other plaintiffs’ firm.  With 200 lawyers in 9 offices, Robbins Geller’s attorneys have obtained many of the largest securities class action recoveries in history, including the largest securities class action recovery ever – $7.2 billion – in In re Enron Corp. Sec. Litig.

Main Menu