GlobeNewswire News Roomยท2025-05-14 17:46Core Viewpoint - Faruqi & Faruqi, LLP is investigating potential claims against Compass Diversified due to alleged violations of federal securities laws, with a deadline for investors to seek lead plaintiff status by July 8, 2025 [4]. Group 1: Allegations Against Compass Diversified - The complaint alleges that Compass and its executives made false and misleading statements and failed to disclose irregularities in its subsidiary, Lugano Holdings, Inc., including unrecorded financing arrangements and issues with sales, cost of sales, inventory, and accounts receivable [6]. - It is claimed that the financial statements of Compass were rendered unreliable due to these irregularities, necessitating a restatement of the financials [6]. - The company is accused of failing to maintain adequate internal controls related to its financial statements, leading to materially false and misleading public statements [6]. Group 2: Impact of the Investigation - On May 7, 2025, Compass disclosed that its financial statements for fiscal year 2024 should no longer be relied upon due to an ongoing internal investigation into Lugano Holdings, which identified irregularities in financing, accounting, and inventory practices [7]. - Following this announcement, Compass Diversified's stock price fell by 8% in after-hours trading, resulting in financial harm to investors [8]. Group 3: Legal Proceedings and Investor Actions - Investors who suffered losses exceeding $100,000 in Compass stock or options between May 1, 2024, and May 7, 2025, are encouraged to contact Faruqi & Faruqi to discuss their legal rights [1]. - The role of lead plaintiff in the class action lawsuit is open to any member of the putative class, with the lead plaintiff being the one with the largest financial interest in the relief sought [9].