According to the Complaint, LuxUrban Hotels Inc. utilizes an asset light business model to lease hotels on a long-term basis and rent hotel rooms in the properties it leases. The Company leases to business and vacation travelers through the Company’s online portal and third-party sales and distribution channels, including several worldwide online travel agency channels. The Company manages a portfolio of hotel rooms in New York, Washington D.C., Miami Beach, New Orleans, and Los Angeles.

In November 2023, the Company announced it had signed a 25-year Master Lease Agreement with the Royalton Hotel in New York.

The Complaint alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, the Complaint alleges Defendants failed to disclose to investors: (1) that the Company had not signed a lease with the Royalton Hotel; (2) that, as a result, LuxUrban’s total reported units was overstated; (3) that LuxUrban faced multiple lawsuits for unpaid rent; and (4) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

On June 18, 2024, the Court issued an Order appointing Lead Plaintiff and Counsel. Lead Plaintiff filed an Amended Complaint on September 4. Defendants filed a Motion to Dismiss the Amended Complaint on December 20.

On July 25, 2025, the Court issued an Order granting in part and denying in part Defendants' Motion to Dismiss.