Driven Brands (US:DRVN) Businesswire·2026-03-19 10:32Core Viewpoint - Driven Brands is facing a class action lawsuit for securities fraud due to significant accounting errors and internal control failures, resulting in a nearly 40% drop in stock price [2][5][6]. Group 1: Lawsuit Details - A class action lawsuit has been filed against Driven Brands Holdings Inc. and certain senior executives, alleging securities fraud after the company disclosed widespread accounting errors [2][4]. - Investors have until May 8, 2026, to request to be appointed as lead plaintiffs in the case, which is pending in the U.S. District Court for the Southern District of New York [4][6]. - The lawsuit asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of investors in Driven Brands common stock [4]. Group 2: Financial Impact - Driven Brands' stock dropped from $16.61 per share on February 24, 2026, to $9.99 per share on February 25, 2026, marking a decline of approximately 39.8% [7][8]. - The company announced it would restate its financial statements for fiscal years 2023 and 2024, as well as for 2025, due to numerous material accounting errors [7][8]. Group 3: Allegations of Misconduct - The allegations include pervasive accounting errors such as lease accounting issues, unreconciled cash balances, improperly classified expenses, and improperly recognized revenue spanning fiscal years 2023 through 2025 [5][6]. - Driven Brands had previously assured investors that its financial reporting was accurate and that its internal controls were effective, which is now being challenged [5].