2022-09-17 | NYSE: KSS | Press release
New York, New York–(Newsfile Corp. – September 17, 2022) – Pomerantz LLP announces that a class action lawsuit has been filed against Kohl’s Corporation (“Kohl’s” or the “Company”) (NYSE: KSS) and certain of its officers. The class action, filed in the United States District Court for the Eastern District of Wisconsin and registered as 22-cv-01016, is on behalf of a class consisting of all persons and entities other than defendants who purchased or otherwise acquired Kohl’s securities between October 20, 2020 and May 19, 2022, both dates inclusive (the “Class Period”), seeking to recover damages caused by the Defendants’ violations of federal securities laws Securities and to seek remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder, to against the Company and certain of its senior executives.
If you are a shareholder who purchased or otherwise acquired Kohl’s securities during the class period, you have until November 1, 2022 to ask the court to name you as the lead plaintiff for the class. A copy of the complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at [email protected] or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 7980. Those making inquiries by email are encouraged to include their mailing address, phone number and number of shares purchased.
[Click here for information about joining the class action]
Kohl’s operates as a retail company in the United States. The Company offers branded apparel, footwear, accessories, beauty and home products through its stores and website.
In October 2020, Kohl’s announced that it had entered into a new strategic framework to “drive revenue growth”, “increase operating margin” and become “the most trusted style retailer of choice. active and relaxed lifestyle” (the “Strategic Planner”). Specifically, the strategic plan included “new initiatives to position the company for long-term success”, including “being[ing] the active, relaxed and beauty destination for the whole family of the most trusted brands, always offering quality and discovery”, “lead[ing] with loyalty and value through a world-class rewards program” and “offer[ing] a differentiated, easy and inviting omnichannel experience, however customers want to shop. In addition, Kohl’s announced that the company “is focused on increasing profitability with the goal of increasing its operating margin to 7% to 8%”. In announcing the strategic plan, the company touted its supposedly strong customer base, industry-leading loyalty and payment card programs, high store volume, and large and growing digital business.
The Complaint alleges that throughout the Class Period, the Defendants made materially false and misleading statements regarding the company’s business, operations and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Kohl’s strategic plan was not well suited to achieving the company’s stated objectives; (ii) Defendants also overestimated the Company’s success in executing its Strategic Plan; (iii) Kohl’s had deficient disclosure controls and procedures, internal control over financial reporting and corporate governance mechanisms; (iv) as a result, the Company’s Board of Directors could and did withhold material information about the condition of Kohl’s prior to the Company’s annual meeting; (v) any of the foregoing, when disclosed, was likely to have a material adverse impact on Kohl’s financial condition and reputation; and (vi) as a result, the Company’s public statements were materially false and misleading at all material times.
On May 19, 2022, Kohl’s issued a press release announcing the company’s results for the first quarter of 2022, noting, among other things, that net sales were only expected to grow by 1% (vs. the Wall Street consensus growth of 1.94%), earnings per share of $0.11 ($0.59 missing estimates), revenue that barely exceeded expectations, and the decision of the company to reduce its full-year earnings forecast. These results conflicted with the defendants’ representations regarding the successful execution of the company’s strategic plan, which was intended to drive revenue growth and position the company for long-term success. Additionally, the press release quotes Kohl’s President and CEO, Defendant Michelle Gass, as saying, in relevant part: “[t]he year started below our expectations. After a strong start to the quarter with positive single-digit comps through the end of March, sales weakened significantly in April as we encountered macroeconomic headwinds from last year’s slowing stimulus and a inflationary consumer environment.”
Then, on May 20, 2022, Macellum Advisors GP, LLC (“Macellum”), “a long-term holder of approximately 5% of the outstanding common stock of Kohl’s”, issued a statement addressing “[t]extremely disappointing results for its quarter,” which Macellum attributed to a “flawed strategic plan and an inability to execute on it. Macellum also said that “the current board of directors appears to have withheld important information about the state of Kohl’s from shareholders in the run-up to this year’s pivotal annual meeting,” which “suggests to us a clear violation of fiduciary duty”.
On this news, Kohl’s stock price fell $5.84 per share, or 12.97%, to close at $39.20 per share on May 20, 2022.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, Paris and Tel Aviv, is recognized as one of the leading law firms in the areas of corporate litigation, securities and antitrust. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues the tradition he established, fighting for the rights of victims of securities fraud, breaches of fiduciary duty and corporate misconduct. The firm recovered numerous multimillion-dollar damages on behalf of class members. See www.pomlaw.com.
Robert S. Willoughby
888-476-6529 ext. 7980
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/137560