Trulieve Cannabis Corp. Class Action Lawsuit
- Company Name
- Trulieve Cannabis Corp.
- Stock Symbol
- Class Period
- September 25, 2018 to December 17, 2019
- Motion Deadline
- February 28, 2020
- Eastern District of New York
On December 30, 2019, the Trulieve Cannabis Corp. class action lawsuit was filed charging Trulieve and certain of its officers with violations of the Securities Exchange Act of 1934. The Trulieve class action lawsuit was commenced in the Eastern District of New York on behalf of purchasers of Trulieve publicly traded securities between September 25, 2018 and December 17, 2019 (the “Class Period”) and is captioned McNear v. Trulieve Cannabis Corp., et al., No. 19-cv-07289.
Trulieve, together with its subsidiaries, operates as a medical marijuana company. Trulieve cultivates and produces medical marijuana products and distributes its products to Trulieve branded stores in Florida and through home delivery to patients.
The Trulieve class action lawsuit alleges that throughout the Class Period, defendants made false and misleading statements and/or failed to disclose adverse information regarding Trulieve’s business and operations. Specifically, defendants failed to disclose that Trulieve overstated its mark-up on its biological assets, which inflated Trulieve’s reported gross profit, and Trulieve had engaged in undisclosed related-party real estate transactions with its Chief Executive Officer’s husband. As a result of this information being withheld from the market, Trulieve securities traded at artificially inflated prices during the Class Period, with its stock price reaching a high of more than $15.50 per share.
Then on December 17, 2019, Grizzly Research published a report stating that Trulieve had failed to disclose it had engaged in real estate transactions with insiders; that rather than high quality indoor-grown product, the vast majority of Trulieve’s marijuana was produced in low quality hoop houses; and that Trulieve’s mark-up on its biological assets was excessive and unreasonable. According to the report, Trulieve had engaged in real estate transactions with One More Wish LLC, which was controlled by the husband of Trulieve’s Chief Executive Officer, Kim Rivers. The report stated that “Florida county records show that One More Wish bought a property . . . in Quincy in June 2018 and sold it to Trulieve in August 2018 for a 42% gain[,] which translates to over 800% annualized return,” and that One More Wish “sold two more properties to Trulieve for spectacular gains.” The report also stated that “Trulieve sports unbelievable gross margins of 130% on average. This is mainly due to the biological assets fair value adjustment that is widely adopted within the industry. However, Trulieve seem to be aggressively using this accounting method towards its benefit to inflate it gross profit and margins.” On this news, the price of Trulieve shares fell $1.51 per share, or over 12%, to close at $10.40 per share on December 17, 2019.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Trulieve securities during the Class Period to seek appointment as lead plaintiff in the Trulieve class action lawsuit. A lead plaintiff will act on behalf of all other class members in directing the Trulieve class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Trulieve class action lawsuit. An investor’s ability to share in any potential future recovery of the Trulieve class action lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff of the Trulieve class action lawsuit or have questions concerning your rights regarding the Trulieve class action lawsuit, please provide your information here or contact counsel, Brian E. Cochran of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at email@example.com. Lead plaintiff motions for the Trulieve class action lawsuit must be filed with the court no later than February 28, 2020.
Robbins Geller Rudman & Dowd LLP is one of the world’s leading law firms representing investors in securities class action litigation. With 200 lawyers in 9 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For six consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in the world in both amount recovered for shareholders and total number of class action settlements. Robbins Geller attorneys have helped shape the securities laws and have recovered tens of billions of dollars on behalf of aggrieved victims. Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide. Robbins Geller attorneys are consistently recognized by courts, professional organizations and the media as leading lawyers in the industry.