After announcing plans to part ways with its flagging fresh food division this summer, Campbell Soup Company is now under fire from investors seeking restitution and alleging improper conduct.
According to a report by Bloomberg Law, two complaints—one filed November 5 and another November 27—allege that Campbell’s executives told investors that Campbell Fresh was on a path toward profitability, despite knowledge to the contrary.
“…Defendants made false and/or misleading statements and/or failed to disclose that: the company’s Campbell Fresh division was suffering from known business headwinds, negatively impacting its profitability; and as a result, the company’s public statements as set forth above were materially false and misleading at all relevant times,” the first of these filings alleges, claiming that the plaintiff, Michael Bankalter, suffered significant losses as a result.
The second claim, filed by Charles W. Clayton, echoes those same sentiments, noting that, this Spring, Campbell “reported a $19 million operating loss for the Campbell Fresh division and a $619 million pre-tax non-cash impairment charge as a result of the division’s poor performance.”
The filing continues: “Defendants’ positive statements about the company’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.”
Deli Market News will continue to report on this and other important food industry news.