NEW YORK, Sept. 22, 2023 (GLOBE NEWSWIRE) -- Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, is investigating potential claims against Lovesac Company (NASDAQ: LOVE), and Orthofix Medical Inc. (NASDAQ: OFIX). Our investigations concern whether these companies have violated the federal securities laws and/or engaged in other unlawful business practices. Additional information about each case can be found at the link provided.
Lovesac Company (NASDAQ: LOVE)
On August 15, 2023, Lovesac issued a press release announcing non-reliance on previously issued financial statements or a related audit report. The Company stated, “In June 2023, the Audit Committee (the “Audit Committee”) of the Board of Directors of The Lovesac Company (the “Company”) commenced an internal investigation related to the recording of last mile shipping expenses, resulting from the discovery of a recorded journal entry in the quarter ended April 30, 2023 to capitalize $2.2 million of shipping expenses that related to the fiscal year ended January 29, 2023. In addition to the aforementioned journal entry, the Company has identified through the investigation certain errors with the methodology used by the Company to calculate the accrual of its last mile freight expenses applicable to the Company’s financial statements for the fiscal year ended January 29, 2023 and the thirteen weeks ended April 30, 2023 (the “Prior Financial Statements”).” In addition, the Company stated “as a result of the identified errors related to last mile freight expenses, the Company believes that previously reported operating income and net income were overstated by approximately $1.5 million to $2.5 million and $1.0 million to $2.0 million, respectively, for fiscal year 2023. When aggregating this error with other estimated required correcting entries the Company believes that operating income and net income were overstated by approximately $2.0 million to $3.0 million and $1.5 million to $2.5 million, respectively, for the fiscal year ended January 29, 2023. Additionally, the Company believes that the identified errors related to the accrual methodology, together with the incorrectly recorded entry related to last mile freight expenses resulted in the overstatement of previously reported operating income and net income of less than $0.5 million, respectively, for the thirteen weeks ended April 30, 2023. When aggregating these errors with other estimated required correcting entries the Company believes that operating income and net income were overstated by less than $0.5 million, respectively, for the thirteen weeks ended April 30, 2023.” The Company further stated, “that the Company’s financial statements for fiscal year 2023 included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 29, 2023, management’s report on internal control over financial reporting for the fiscal year ended January 29, 2023, the associated audit report and report on internal control over financial reporting of the Company’s independent registered public accounting firm, Deloitte & Touche LLP (“Deloitte”), and the Company’s condensed financial statements included in the Company’s Quarterly Report on Form 10-Q for the thirteen weeks ended April 30, 2023, should no longer be relied upon.”
On this news, Lovesac’s stock price fell $0.50 per share, or 2.06%, to close at $23.76 per share on August 16, 2023.
For more information on the Lovesac investigation go to: https://bespc.com/cases/LOVE
Orthofix Medical Inc. (NASDAQ: OFIX)
On September 12, 2023, before the market opened, Orthofix disclosed that its Board's independent directors made the unanimous decision to terminate for cause Keith Valentine, John Bostjancic and Patrick Keran from their roles as Chief Executive Officer, Chief Financial Officer, and Chief Legal Officer, respectively. The Board also requested that Mr. Valentine resign from the Board. The Company further disclosed that the decision followed an investigation conducted by independent outside legal counsel and directed and overseen by the Company's independent directors, and that the Board determined that each of the executives engaged in conduct that "violated multiple code of conduct requirements and was inconsistent with the Company's values and culture."
On this news, Orthofix's share price fell $5.62, or 30.2%, to close at $13.01 per share on September 12, 2023, thereby injuring investors.
For more information on the Orthofix investigation go to: https://bespc.com/cases/OFIX
About Bragar Eagel & Squire, P.C.:
Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York, California, and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.
Contact Information:
Bragar Eagel & Squire, P.C.
Brandon Walker, Esq.
Marion Passmore, Esq.
(212) 355-4648
investigations@bespc.com
www.bespc.com
