According to the Complaint, Celsius Holdings, Inc. is a holding company that develops, processes, markets, distributes, and sells energy drinks and liquid supplements in the United States and internationally. This lawsuit was filed against Celsius and two of its Officers.

On August 1, 2022, Celsius entered into a long-term distribution agreement with PepsiCo, Inc. (“Pepsi”) through which Pepsi would tap into its extensive network of retail and foodservice channels to become the primary distributor of Celsius products in the United States and Celsius’ exclusive distributor in Canada. Pepsi also gained the option to become the preferred distribution partner for Celsius in other international markets.

The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Celsius materially oversold inventory to Pepsi far in excess of demand, and faced a looming sales cliff during which Pepsi would significantly reduce its purchases of Celsius products; (ii) as Pepsi drew down significant amounts of inventory overstock, Celsius’ sales would materially decline in future periods, hurting Celsius’ financial performance and outlook; (iii) Celsius’ sales rate to Pepsi was unsustainable and created a misleading impression of Celsius’ financial performance and outlook; (iv) as a result, Celsius’ business metrics and financial prospects were not as strong as indicated in Defendants’ Class Period statements; and (v) consequently, Defendants’ statements regarding Celsius’ outlook and expected financial performance were false and misleading at all relevant times.