SKECHERS Claims Shareholder Lawsuits Based on Two-Year Old Allegations Are Frivolous and Without Merit
October 30 2017 - 8:50AM
Business Wire
- The Company Plans to Defend Lawsuits
Vigorously
- The Company Believes Timing was
Intended to Distract Investors and the Industry from Record Third
Quarter 2017 Earnings Announcement
SKECHERS USA, Inc. (NYSE:SKX), a global footwear leader, denies
the allegations in the recent alleged shareholder class actions as
frivolous and malicious, and plans on defending them
vigorously.
On October 20, 2017, the Steamfitters Local 449 Pension Plan
filed a securities class action—on behalf of itself and purportedly
other shareholders who purchased SKECHERS stock during a five-month
period in 2015—against the Company and certain of its officers, in
the United States District Court for the Southern District of New
York, case number 1:17-cv-08107. The lawsuit alleges that, between
April 23 and October 22, 2015, the Company made materially false
statements or omissions of material fact about the anticipated
performance of its domestic wholesale business segment and asserts
claims for unspecified damages, attorneys’ fees, and equitable
relief based on alleged violations of federal securities laws. The
lawsuit was filed against the Company and two of its officers by
Labaton Sucharow LLP, but the Company has become aware of a
copy-cat complaint and other plaintiffs’ lawyers posting internet
“shareholder alerts” of “investigations.”
David Weinberg, SKECHERS chief financial officer, commented:
“These lawsuits are frivolous, coming two years after the fact and
immediately after we reported a new quarterly sales record for the
third quarter of 2017. Further, the allegations are about the third
quarter of 2015, which at the time was a quarterly net sales record
for the Company, and both the earnings from operations and net
earnings for the same period in 2015 were an impressive increase
over the prior year. The lawsuit, at best, shows a complete
misunderstanding of both our business and the footwear industry
and, at worse and as the timing suggests, shows it was brought to
distract investors, the industry, and consumers from our record
third quarter 2017 earnings, announced one day before the lawsuit
was filed. (See referenced third quarter 2017 earnings
announcement). It is ironic that this lawsuit was filed the day
after we announced three consecutive record quarters in 2017, which
followed annual record net sales in 2016. Our record net sales in
both 2016 and 2017, as well as that of 2015, are a testament to the
power and continuing strength of our global brand. These lawsuits
are without merit, and we will be vehemently defending the Company
and our officers in court.”
SKECHERS is being represented in the lawsuit by Daniel
Petrocelli, Seth Aronson, Jeffrey Barker, and Abby Rudzin of
O’Melveny & Myers in New York and Los Angeles.
About SKECHERS USA, Inc.
SKECHERS USA, Inc., based in Manhattan Beach, California,
designs, develops and markets a diverse range of lifestyle footwear
for men, women and children, as well as performance footwear for
men and women. SKECHERS footwear is available in the United States
and over 160 countries and territories worldwide via department and
specialty stores, 2,438 SKECHERS Company-owned and
third-party-owned retail stores, and the Company’s e-commerce
websites. The Company manages its international business through a
network of global distributors, joint venture partners in Asia and
the Middle East, and wholly-owned subsidiaries in Canada, Japan,
throughout Europe and Latin America. For more information, please
visit skechers.com and follow us on Facebook
(facebook.com/SKECHERS) and Twitter (twitter.com/SKECHERSUSA).
This announcement contains forward-looking statements that are
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements include, without limitation, Skechers’ future domestic
and international growth, financial results and operations
including expected net sales and earnings, its development of new
products, future demand for its products, its planned domestic and
international expansion, opening of new stores and additional
expenditures, and advertising and marketing initiatives.
Forward-looking statements can be identified by the use of
forward-looking language such as “believe,” “anticipate,” “expect,”
“estimate,” “intend,” “plan,” “project,” “will be,” “will
continue,” “will result,” “could,” “may,” “might,” or any
variations of such words with similar meanings. Any such statements
are subject to risks and uncertainties that could cause actual
results to differ materially from those projected in
forward-looking statements. Factors that might cause or contribute
to such differences include international economic, political and
market conditions including the uncertainty of sustained recovery
in Europe; sustaining, managing and forecasting costs and proper
inventory levels; losing any significant customers; decreased
demand by industry retailers and cancellation of order commitments
due to the lack of popularity of particular designs and/or
categories of products; maintaining brand image and intense
competition among sellers of footwear for consumers, especially in
the highly competitive performance footwear market; anticipating,
identifying, interpreting or forecasting changes in fashion trends,
consumer demand for the products and the various market factors
described above; sales levels during the spring, back-to-school and
holiday selling seasons; and other factors referenced or
incorporated by reference in Skechers’ annual report on Form 10-K
for the year ended December 31, 2016 and its quarterly report on
Form 10-Q for the six months ended June 30, 2017. The risks
included here are not exhaustive. Skechers operates in a very
competitive and rapidly changing environment. New risks emerge from
time to time and the companies cannot predict all such risk
factors, nor can the companies assess the impact of all such risk
factors on their respective businesses or the extent to which any
factor, or combination of factors, may cause actual results to
differ materially from those contained in any forward-looking
statements. Given these risks and uncertainties, you should not
place undue reliance on forward-looking statements as a prediction
of actual results. Moreover, reported results should not be
considered an indication of future performance.
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SKECHERS USA, Inc.Jennifer Clay(310) 937-1326
Skechers USA (NYSE:SKX)
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