According to a press release dated May 24, 2010, the complaint charges Vitacost.com and certain of its officers and directors with violations of the Securities Act of 1933 and the Securities Exchange Act of 1934. Vitacost.com operates as an online retailer and direct marketer of health and wellness products. The Complaint alleges that throughout the Class Period defendants knew or recklessly disregarded that their public statements concerning Vitacost.com's financial performance were materially false and misleading. Specifically, the Complaint alleges that defendants' public statements failed to disclose or indicate the following: (1) that the Company was starting a product-mix shift away from the high-margin proprietary products; (2) that the Company inflated demand for its proprietary products; (3) that the Company was pushing out excess product to customers so that it could mask declining demand; (4) that the Company was experiencing logistical issues at its own plants; (5) that the Company lacked significant oversight processes and procedures and utilized ineffective operations software, despite knowing that those issues existed; (6) that as a result of this, the Company’s financial results were materially inflated at all relevant times; (7) that the Company lacked adequate internal and financial controls; and (8) that the Company's projections regarding future growth lacked in any reasonable basis when made.
On April 20, 2010, after the close of the market, Vitacost.com issued a press release in which it announced updated guidance for revenue and fully diluted earnings per share for the first quarter ending on March 31, 2010 and full year 2010. Specifically, the Company cut its first-quarter and full-year profit and revenue estimates, citing disappointing sales along with manufacturing problems. On this news, shares of Vitacost.com stock declined $3.02 per share, or 24 percent, to close on April 21, 2010 at 9.54 per share, on unusually heavy volume.
On October 18, 2010, the Court issued an Order Appointing Montgomery County Employees’ Retirement Fund As Lead Plaintiff And Approving their Choice Of Counsel.
On February 15, 2011, a Consolidated Amended Class Action Complaint For Violations Of Federal Securities Laws was filed by the lead plaintiffs.
On December 8, 2011, the Court issued an Order granting the defendants' motions to dismiss. The amended complaint was dismissed without prejudice, and plaintiffs were given 20 days to file a second amended complaint.
On January 12, 2012, the plaintiffs filed their second amended complaint.
On June 25, 2012, the Court issued the Order of Final Judgment and Order Closing Case. Final judgment is entered against plaintiff and in favor of defendants. The Clerk of Court shall close this case.
On June 5, 2013, the United States Court of Appeals for the Eleventh Circuit issued a Mandate affirming the judgment of the district court.