Party City Holdco Inc. Class Action Lawsuit - PRTYQ
Case Summary
Investors who suffered a loss and would like to learn more, click here to contact us.
The Party City class action lawsuit seeks to represent purchasers or acquirers of Party City Holdco Inc. (OTC: PRTYQ) securities between November 8, 2022 and June 9, 2023, inclusive (the “Class Period”). Captioned Shulman v. Weston, No. 23-cv-04121 (D.N.J.), the Party City class action lawsuit charges certain of Party City’s top executive officers with violations of the Securities Exchange Act of 1934.
If you suffered substantial losses and wish to serve as lead plaintiff of the Party City class action lawsuit, please provide your information in the form on this page. 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 Party City class action lawsuit must be filed with the court no later than October 2, 2023.
CASE ALLEGATIONS: Party City sells party goods, costumes, decorations, and related items through retail and wholesale channels.
The Party City class action lawsuit alleges that defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that: (i) Party City affirmatively misrepresented that its capital resources “will be adequate to meet our liquidity needs for at least the next twelve months”; (ii) there was substantial doubt about Party City’s ability to continue as a going concern; (iii) Party City downplayed the nature and extent of its then-existing liquidity problems; (iv) Party City’s credit facilities were insufficient to satisfy its operational needs and that it was unable to obtain additional loans in the normal course of business; and (v) there was a material weakness in Party City’s internal controls over financial reporting.
On January 6, 2023, The Wall Street Journal published an article stating for the first time that Party City was contemplating bankruptcy. On this news, the price of Party City stock declined 50%.
Then, on January 17, 2023, Party City filed for bankruptcy pursuant to Chapter 11 of the U.S. Bankruptcy Code. On this news, the price of Party City stock declined more than 67% over two trading sessions.
Thereafter, on June 9, 2023, Party City revealed that: (i) its third quarter 2022 Form 10-Q should have included a “going concern” warning; (ii) there was a material weakness in internal controls over financial reporting as of the date the third quarter 2022 Form 10-Q was filed; and (iii) Ernst & Young LLP resigned as Party City’s auditor due to a disagreement with Party City management about Party City’s treatment of the going concern issue. On this news, the price of Party City stock declined nearly 22% over three trading sessions, further damaging investors.
THE LEAD PLAINTIFF PROCESS: The Private Securities Litigation Reform Act of 1995 permits any investor who purchased or acquired Party City securities during the Class Period to seek appointment as lead plaintiff of the Party City 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 Party City class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Party City class action lawsuit. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff of the Party City class action lawsuit.
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 most recent ISS Securities Class Action Services Top 50 Report for recovering more than $1.75 billion for investors in 2022 – the third year in a row Robbins Geller tops the list. And in those three years alone, Robbins Geller recovered nearly $5.3 billion for investors, more than double the amount recovered by any other plaintiffs’ firm. With 200 lawyers in 10 offices, Robbins Geller is one of the largest plaintiffs’ firms in the world and the Firm’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.