Sign In
OTLY.US
id: 1109

Oatly (OTLY) $9.25M Settlement Over Financial Mirepresentation and China Growth Issues

S.D. New York
Court
1:21-cv-06360
Case number
20 May 2021
Class period Start
15 Nov 2021
Class period End
25 Jul 2024
Claim deadline
Oatly (OTLY) agreed to settle $9.25M with shareholders to end claims over exaggerating uniqueness and China success.

Outline

In 2021, Spruce Point Capital claimed that Oatly exaggerated its financials and overstated its growth in China. This article also caused numerous reports exposing major issues in Oatly's finances and business practices. Following this, $OTLY significantly fell, and Oatly faced a lawsuit from investors.

Timeline
  • On July 14, 2021: Spruce Point Capital accused Oatly of financial misstatements and exaggerating growth in China.
  • On July 14, 2021: Following this report, $OTLY fell 2.8%.
  • On July 15, 2021: Further news supported the allegations in the Spruce Point report.
  • On July 15, 2021: After that, $OTLY fell again by 5.36%.
  • On July 26, 2021: Stockholders filed a lawsuit against Oatly for misleading investors about its financial health, sustainability practices, and growth in China.
Background

Oatly highlighted strong financial performance and impressive growth in China as key advantages for its U.S. IPO.

However, on July 14, 2021, Spruce Point Capital Management released a report accusing Oatly of manipulating its financial metrics and overstating revenue, gross margins, and market share.

It also claimed that Oatly exaggerated its sustainability by using old studies and only showing positive data, ignoring negative effects like high water usage

The report accused Oatly of exaggerating its growth in China, while Oatly claimed a 450% sales growth and more than 10000 cafes in mainland China, SEC filings indicated only 8000 to 8200 locations.

Moreover, it was said that Oatly's Maanshan facilities were delayed, not nearly operational as claimed, which raised doubts about Oatly's reported growth.

Following this report, $OTLY dropped by 2.8%.

Further investigation from CNBC and Fortune also found major issues with Oatly’s financial reports and business practices. These media investigations supported Spruce Point's claims, raising more questions about Oatly's financial practices and business claims.

Following that, in July 2021, Oatly was sued by investors who claimed the company misled them about its financial health and reporting practices.

What can investors expect now?

Oatly (OTLY) agreed to settle $9.25M with shareholders to end claims over exaggerating uniqueness and China success.

If you were damaged due to this situation, you can file for a payout and get your share of the settlement. You can check if you are eligible and other details in the FAQ section below.
Case Status
Accepting Claims
Alleged Offence
Mismanagement
Misleading Statements
Omissions
Suspected Party
Directors
Management
Security Type
Stocks
Trade Direction
Long
Filing date
26 July 2021
Plaintiffs
Kai Jochims
Attorneys
Robbins Geller Rudman & Dowd LLP, Scott + Scott Attorneys at Law LLP
Defendants
Toni Petersson, Christian Hanke, Steven Chu, Ann Chung, Bernard Hours, Hannah Jones, Mattias Klintemar, Po Sing (Tomakin) Lai, Eric Melloul, Bjorn Oste, Frances Rathke, Yawen Wu, Tim Zhang, Fredrik Berg
Judge
Alvin K. Hellerstein
Attorney fee
$9,250,000
Trades matching type
FIFO
+$9,250,000
Cash Settlement Amount

Frequently Asked Questions

Oatly Group AB ADR

Oatly Group AB, an oatmilk company, provides a range of plant-based dairy products made from oats in Europe, the Middle East, Africa, the Americas, and Asia. It offers Barista edition oatmilk, oatg...

    Ticker
    OTLY.US
    ISIN
    US67421J1088
    CIK
    1843586
    Sector
    Consumer Defensive
    Industry
    Packaged Foods
    Country
    USA
    Address
    Ångfärjekajen 8, Malmö, Sweden, 211 19