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Case Status:    SETTLED
On or around 08/19/2019 (Ongoing date of last review)

Filing Date: September 06, 2018

Plaintiff's law firm issued a press release on September 6, 2018, announcing the lawsuit. According to the press release, Qurate markets and sells various consumer products primarily through live merchandise-focused televised shopping programs, websites, and mobile applications. Qurate Retail, Inc. is comprised of eight leading retail brands – QVC, HSN, zulily, Ballard Designs, Frontgate, Garnet Hill, Grandin Road, and Improvements, all dedicated to providing a "third way to shop" that goes beyond transactional eCommerce and traditional stores. The Company is number one in video commerce, with a worldwide reach of nearly 360 million homes via 16 television channels and multiple media outlets. QVC, Inc. ("QVC") is Qurate's largest segment, accounting for roughly 85 percent of the Company's total revenue in 2016.

As a promotional tool used to spur sales, QVC offers a payment plan called Easy-Pay to its customers in the U.S., U.K., Germany and Italy (known as Q-Pay in Germany, and Italy). Easy Pay allows QVC customers to pay for certain merchandise in two or more monthly installments. When Easy-Pay is elected by the QVC customer, the first installment is billed to the customer's credit card upon shipment and an Easy-Pay receivable is established to account for the collection of subsequent installments.

On November 26, 2018, the Court issued an Order appointing Lead Plaintiff and Counsel.

Qurate is exposed to the credit risk on the Easy-Pay receivables. Specifically, if the QVC customer does not remit payment for the subsequent Easy-Pay installments, Qurate is required to record a loss and write off the Easy-Pay receivable. Under Generally Accepted Accounting Principles, the Company is required to establish adequate reserves for its Easy-Pay receivables.

The Complaint alleges that throughout the Class Period, Qurate repeatedly attributed its growth to broad-based marketing and higher personalized customer experience, which the Company claimed would spur continued revenue growth. However, Defendants' Class Period statements pertaining to the Company's revenue growth were materially false and misleading because Defendants failed to disclose that: (1) the Company was aggressively loosening the credit standards of its Easy-Pay program to attract a large group of new customers; (2) the Company's strong sales growth was due to this loose credit policy; (3) accounts receivable associated with this new group of customers posed a high risk of write-off; and (4) as a result of the foregoing, the Company's positive statements about its business, operations, and prospects lacked a reasonable basis.

On November 26, 2018, the Court issued an Order appointing Lead Plaintiff and Counsel. Lead Plaintiff filed an amended Complaint on May 30, 2019. On May 31, the parties entered into a Stipulation and Agreement of Settlement. The Court issued an Order preliminarily approving the Settlement on June 11.

COMPANY INFORMATION:

Sector: Consumer Non-Cyclical
Industry: Personal & Household Products
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: QRTEA
Company Market: NASDAQ
Market Status: Public (Listed)

About the Company & Securities Data


"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: D. Colorado
DOCKET #: 18-CV-02300
JUDGE: Hon. Michael E. Hegarty
DATE FILED: 09/06/2018
CLASS PERIOD START: 08/05/2015
CLASS PERIOD END: 09/07/2016
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Franklin D. Azar & Associates, P.C.
  2. Thornton Law Firm, LLP
No Document Title Filing Date
COURT: D. Colorado
DOCKET #: 18-CV-02300
JUDGE: Hon. Michael E. Hegarty
DATE FILED: 05/30/2019
CLASS PERIOD START: 08/05/2015
CLASS PERIOD END: 09/08/2016
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Labaton Sucharow LLP
    140 Broadway, Labaton Sucharow LLP, NY 10005
    212.907.0700 212.818.0477 · info@labaton.com
  2. The Shuman Law Firm (Denver)
    600 17th Street Suite 2800 South , The Shuman Law Firm (Denver), CO 80202
    303-861-3003 303-536-7849 ·
  3. Wolf Haldenstein Adler Freeman & Herz LLP (New York)
    270 Madison Avenue, Wolf Haldenstein Adler Freeman & Herz LLP (New York), NY 10016
    212.545.4600 212.686.0114 · newyork@whafh.com
No Document Title Filing Date
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