Class Action Announcement (CROX): Kessler Topaz Meltzer & Check, LLP Has Filed a Securities Fraud Class Action Lawsuit Against Crocs, Inc. (CROX)

Lawsuit Overview - A securities fraud class action lawsuit has been filed against Crocs Inc on behalf of investors who purchased or acquired Crocs common stock between November 3 2022 and October 28 2024 [1] - The lawsuit alleges that Crocs misled investors regarding the sustainability of HEYDUDE's revenue growth and the impact of overstocking on the company's financial results [3][8] HEYDUDE Acquisition and Revenue Impact - Crocs acquired HEYDUDE in February 2022 and the brand accounted for approximately 25% of the company's total revenues in 2022 [2] - HEYDUDE's revenue growth was largely driven by aggressive stocking of third-party wholesaler pipelines rather than actual retail demand [3] - HEYDUDE's wholesale revenues declined 19.4% to $146.5 million in Q3 2023 due to prior overstocking and cautious wholesale orders [6] Stock Price Declines - Crocs' stock price declined$23.46 per share (nearly 16%) on April 27 2023 after the company revealed the unsustainable nature of HEYDUDE's revenue growth [4] - The stock price declined nearly 4% on August 16 2023 after Williams Trading LLC decreased its price target on Crocs from $145 to$113 per share [5] - Crocs' stock price declined $4.62 per share (over 5$26.47 per share (approximately 19.2%) on October 29 2024 after HEYDUDE's revenues fell below expectations [9] Management Disclosures and Actions - Crocs' CEO Andrew Rees admitted that the company shipped too much product in 2022 and 2023 and that inventory was too high [7][9] - The company is proactively lowering in-channel inventories and working with strategic accounts to clean up inventory and improve sell-through [7] - Rees acknowledged that HEYDUDE's recent performance and the current operating environment indicate it will take longer than initially planned for the business to recover [9]