Welcome to America: Oddity Tech Ltd., an Israeli company known for its beauty and wellness products, is facing a potential class action lawsuit filed by an investor following a devasting short seller report. The suit alleges that ODDITY exaggerated the capabilities of its artificial intelligence technology prior to its $424 million initial public offering (IPO) last year. The lawsuit is coordinated by Kahn Swick & Foti (KSF), a Louisiana-based law firm.
Kahn Swick & Foti have issued a reminder to investors that they have until September 17, 2024, to file lead plaintiff applications in the securities class action lawsuit against Oddity Tech Ltd. (NasdaqGM: ODD). This lawsuit is relevant for those who purchased the company’s securities between July 19, 2023, and May 20, 2024, inclusive (the “Class Period”). The case is currently pending in the United States District Court for the Eastern District of New York.
Allegations and Lawsuit Details
The lawsuit claims that ODDITY and certain executives failed to disclose crucial information during the Class Period, thereby violating federal securities laws. On May 21, 2024, the short seller NINGI Research published a report containing several allegations against the company. Key points from the report include:
- Claims that ODDIY misled investors about significant aspects of its business.
- Former employees allegedly disclosed that the company’s AI technology was merely a questionnaire.
- There have been accusations that the company’s reported high repeat purchase rates were due to customers unknowingly enrolling in non-cancelable plans, which led to recognized repeat purchases in subsequent quarters despite the customers not wanting the product.
- Discovery of hundreds of undisclosed lawsuits filed against Oddity and its subsidiaries in both the US and Israel, many of which involved allegations of unpaid bills and violations of consumer protection laws, including multiple class action lawsuits from recent years.
Following the release of the NINGI Research report, Oddity’s share price dropped by $3.02 per share, or 7.37%, closing at $37.97 per share on May 21, 2024.
ODDITY rejects the short seller report and says that the allegations are based on demonstrable factual inaccuracies, incorrect assumptions, and unfounded and malicious speculation.
Case Information
The case, titled Hoare v. Oddity Tech Ltd., et al., bears the case number 24-cv-05037. Investors who believe they were affected by these allegations are encouraged to join the lawsuit before the September 17, 2024, deadline.
