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Compass Diversified (CODI) Faces Securities Class Action After Admitting to Accounting "Irregularities" - Hagens Berman
CODI Investors with Losses Encouraged to Contact Hagens Berman
San Francisco, California--(Newsfile Corp. - May 28, 2025) - A securities class action lawsuit has been filed against Compass Diversified (NYSE: CODI) and certain of its executives after the company disclosed that it would restate its 2024 financial statements due to unrecorded financing arrangements and "irregularities" within its Lugano business unit. The suit, styled Matthews v. Compass Diversified Holdings, LLC, et al., No. 8:25-cv-00981 (C.D. Cal.), seeks to represent investors who purchased Compass Diversified securities between May 1, 2024 and May 7, 2025.
Hagens Berman is investigating the claims and urges investors who purchased Compass shares and suffered substantial losses to submit your losses now. The firm also encourages persons with knowledge that may assist the firm's investigation to contact its attorneys.
Class Period: May 1, 2024 - May 7, 2025
Lead Plaintiff Deadline: July 8, 2025
Visit: www.hbsslaw.com/investor-fraud/codi
Contact the Firm Now: [email protected]
844-916-0895
The Compass Diversified (CODI) Securities Class Action
The complaint contends that Compass made false and misleading statements and failed to disclose critical information regarding Lugano, which operates in the branded consumer goods sector. Specifically, the lawsuit claims that Lugano maintained undisclosed financing arrangements and exhibited irregularities in its sales, cost of sales, inventory, and accounts receivable.
These alleged irregularities, according to the complaint, rendered Compass Diversified's 2024 financial statements unreliable, necessitating a restatement. Furthermore, the suit alleges that Compass's internal controls over financial reporting were inadequate, contrary to previous representations.
The truth, the lawsuit claims, came to light on May 7, 2025, after the close of trading. Compass issued a regulatory filing (Form 8-K) accompanied by a press release titled "Compass Diversified Discloses Non-Reliance on Financial Statements for Fiscal 2024 Amid an Ongoing Internal Investigation into its Subsidiary, Lugano Holding, Inc." In this release, Compass disclosed that it had "preliminarily identified irregularities in Lugano's non-CODI financing, accounting, and inventory practices." The company further stated that its audit committee had concluded that the previously issued 2024 financial statements required restatement and should no longer be relied upon.
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