In a statement Friday, Bala Cynwyd, Pennsylvania-based law firm Schiffrin & Barroway LLP said it filed a suit in the U.S. District Court for the Middle District of North Carolina on behalf of all purchasers of Krispy Kreme shares from August 21, 2003 through May 7, 2004.
The complaint names members of Krispy Kreme’s senior management as defendants, and charges that they disregarded signs that the company had expanded too quickly, that its wholesale business undermined sales at its retail stores, and that it faced stiff competition from rival doughnut chain Dunkin’ Donuts.
According to the statement, the suit also alleges that “the company ineptly accounted for how their bottom line would be affected by the popular low-carbohydrate diets; first by claiming that the trend would have no influence, and then by over-exaggerating the effect of the diet fad.”
New York-based law firm Geller Rudman PLLC also said on Friday that it filed a similar lawsuit. And, earlier this week New York law firm Milberg Weiss Bershad & Schulman LLP also said it filed a lawsuit on behalf of Krispy Kreme