Since the initial outbreak of COVID-19 in the U.S. in March 2020, there have been scores of COVID-related securities suit filed. However, as the pandemic itself progressed, the nature of the lawsuits being filed also changed. Over time, the plaintiffs’ lawyers began targeting companies that had initially prospered at the outset of the pandemic, but whose fortunes flagged as circumstances changed. The prototypical example of a COVID-19-related securities suit involving a company that experienced this particular sequence of events is the lawsuit filed against exercise equipment company Peloton, whose equipment sold briskly at the outset of the pandemic but whose sales slackened as government shutdown orders lapsed and people began returning to work. However, in a March 30, 2023 order (here), the court granted the defendants’ motion to dismiss in the Peloton case, albeit without prejudice, in a decision that does not bode well in these kinds of change-of-fortune pandemic-related securities suits.
Source: Dismissal Granted in Peloton COVID-Related Securities Suit | The D&O Diary