In re Aaron’s Inc. Securities Litigation
|Court:||United States District Court of the Northern District of Georgia, Atlanta Division|
|Judge:||Judge Steve C. Jones|
|Class Period:||02/06/2015 - 10/29/2015|
|Case Contacts:||Adam H. Wierzbowski, Brenna Nelinson|
This securities class action filed on behalf of investors in Aaron’s, Inc. (“Aaron’s” or “the Company”) who purchased or otherwise acquired common stock issued by Aaron’s between February 6, 2015 and October 29, 2015 (the “Class Period”) asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
Specifically, the action asserts claims for violations of the federal securities laws against Aaron’s – a lease-to-own company that provides electronics, furniture and other consumer merchandise to low income customers – and senior executives of Aaron’s and Progressive Finance Holdings LLC (“Progressive”), a virtual lease-to-own company acquired by Aaron’s prior to the Class Period (collectively, “Defendants”). Aaron’s repeatedly told investors that its acquisition of Progressive would benefit its business, primarily because Progressive utilized a proprietary underwriting algorithm that allowed merchants to make underwriting decisions through “virtual” portals.
The action alleges that Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by (i) concealing the loss of access to critical data feeds to the Progressive algorithm in early 2015 and subsequent software issues preventing the Company from timely identifying and collecting on delinquent accounts; (ii) failing to cease issuing leases while these problems were pending; (iii) misrepresenting the benefits of Progressive’s algorithm to investors, and (iv) concealing the material impact of these software issues and misrepresenting the financial health of the Company.
Upon revelation of the truth about Aaron’s software issues and the financial impact of these issues during an October 30, 2015 earnings conference call with investors, the price of Aaron’s common stock dropped sharply, causing investors to incur substantial losses.
On September 18, 2017, the Honorable Steve C. Jones, U.S. District Judge for the Northern District of Georgia, entered an Order appointing Arkansas Teacher Retirement System as Lead Plaintiff and appointing BLB&G as Lead Counsel for the investor class.
Pursuant to the Court’s September 1, 2017 Scheduling Order, Lead Plaintiff filed its amended complaint on October 27, 2017. The parties are now in the midst of motion to dismiss briefing.
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