A Domino’s Pizza shareholder has filed a class action lawsuit on behalf of all shareholders who purchased Domino’s securities between December 2023 and July 2024, claiming that the company allegedly misrepresented its long-term growth guidance.
According to the lawsuit, Domino’s shareholders claim the Ann Arbor, Mich.-based pizza chain made misleading claims about the company’s annual global net store growth potential. The lawsuit alleges that during the December 2023 Investor Day, the company made “materially false and misleading statements regarding the company’s business, operations, and prospects,” specifically about the financial challenges facing the company’s largest global master franchisee, DPE (Domino’s Pizza Enterprises), which owns about 18% of Domino’s stores portfolio-wide.
“Defendants made false and/or misleading statements and/or failed to disclose that DPE was experiencing significant challenges with respect to both new store openings and closures of existing stores,” the lawsuit reads. “As a result, Domino’s was unlikely to meet its own previously issued long-term guidance for annual global net store growth; accordingly, Domino’s business and/or financial prospects were overstated.”
The lawsuit states that it was not until July 2024, when Domino’s released its second quarter updates, that the company disclosed that it would fall below expected international store growth levels and was “temporarily suspending its guidance.”
Shareholders are being represented by law firm Bernstein Liebhard. The lawsuit will seek to recover damages associated with purchases of Domino’s shares during the stated time period and shareholders have until November to join the class action lawsuit.
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