Pomerantz LLP announces that a class action lawsuit has been filed against Ulta Beauty, Inc. ("Ulta" or the "Company") (ULTA) and certain of its officers. The class action, filed in United States District Court, Northern District of Illinois, and docketed under 18-cv-01577, is on behalf of a class consisting of investors who purchased or otherwise acquired Ulta securities between March 30, 2016, and February 23, 2018, both dates inclusive (the "Class Period"), seeking to recover damages caused by Defendants' violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 10b-5 promulgated thereunder, against the Company and certain of its top officials.
Ulta Beauty, Inc. operates a chain of beauty stores. The Company offers cosmetics, fragrance, skin and hair care products, and salon services, and serves customers throughout the United States.
The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company's business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) the Company was engaged in the widespread practice of repackaging returned cosmetics and re-shelving them alongside unblemished products to sell at full retail price; and (ii) that as a result of the foregoing, Ulta's public statements were materially false and misleading at all relevant times.
On February 9, 2018, at market close, media outlets reported that a consumer class action lawsuit had been filed against Ulta, alleging that the Company engaged in the "widespread and surreptitious" practice of repacking returned cosmetics and re-shelving them alongside unblemished products to sell at full price. According to the lawsuit, "dozens of other current and former Ulta employees from retail locations all over the country confirmed that substantially similar practices also occurred at the Ulta stores where they worked."
On this news, Ulta's share price fell $9.07, or 4.15%, to close at $209.48 on February 12, 2018, the following trading day.
Then, on February 23, 2018, CBS News published a story on its website entitled 'Former Ulta Beauty employee says she felt pressured to resell used products,' reporting on statements, initially made on Twitter by at least one former Ulta employee, to the effect that Ulta store managers frequently pressured the Company's employees to clean and resell used products.
On this CBS News report, Ulta's share price fell $8.18 or 3.94%, to close at $198.93 on February 26, 2018.