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Kessler Topaz Meltzer & Check, LLP: Investor Class Action Filed Against Vroom, Inc. - VRM for Securities Fraud Violations

Notice is hereby given that a class action lawsuit has been filed on behalf of those who purchased or acquired Vroom, Inc. (“Vroom”) (NASDAQ: VRM) securities between June 9, 2020 and March 3, 2021, inclusive (the “Class Period”).
 

Vroom investors may receive additional information about the case by clicking the link "Submit Your Information" above.

Vroom operates an end-to-end ecommerce platform that sells fully reconditioned vehicles. It purports to offer an “exceptional ecommerce experience” that provides customers with transparent pricing, real-time financing, and nationwide contact-free delivery.

The Class Period commences on June 9, 2020, when Vroom filed the prospectus for its initial public offering (“IPO”) with the U.S. Securities and Exchange Commission (“SEC”) on a Form 424B4, which incorporated and formed part of the registration statement for the IPO. 

On September 8, 2020, Vroom filed with the SEC a registration statement on a Form S-1 for a follow-on stock offering, in which Vroom sold 10.8 million shares of stock at $54.50 per share for nearly $590 million in gross offering proceeds (the “Secondary Offering”).  On September 11, 2020, Vroom filed the prospectus for the Secondary Offering with the SEC on a Form 424B4, which formed part of and incorporated the registration statement for the Secondary Offering.

According to the complaint, on March 3, 2021, Vroom announced its fourth quarter and full year 2020 financial results. Therein, Vroom reported that fourth quarter “Ecommerce Vehicle gross profit per unit decreased 13.1% to $878, driven primarily by lower sales margins, partially offset by improvements in inbound logistics and reconditioning costs per unit.” Vroom also reported that for the fourth quarter, its “[n]et loss increased 41.9% to $60.7 million.” During the accompanying earnings call, the defendants revealed that Vroom was suffering from serious sales and support bottlenecks which had severely constrained Vroom’s growth and profits per vehicle.  Following this news, Vroom’s stock price fell $12.29 per share, or 27.9%, to close at $31.61 per share on March 4, 2021. 

The complaint alleges that, throughout the Class Period, the defendants made false and/or misleading statements and/or failed to disclose that: (i) Vroom was unable to sell a significant portion of existing inventory as a result of inadequate sales personnel and overreliance on third-party sales support; (ii) Vroom’s lack of adequate sales and support staff had resulted in severe growth constraints, degraded customer experience, lost sales opportunities and a greater than 10% increase in average days to sale for Vroom products; (iii) Vroom had been forced to mark down and liquidate existing inventory at fire sale prices; and (iv) as a result of the foregoing, the defendants’ positive statements about Vroom’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

If you are a member of the class described above, you may no later than May 21, 2021 move the Court to serve as lead plaintiff of the class, if you so choose.


A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Filling out the online form above or communicating with any counsel is not necessary to participate or share in any recovery achieved in this case.  Any member of the purported class may move the court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.

If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Kessler Topaz Meltzer & Check, LLP:  James Maro, Esq. (484) 270-1453 or Adrienne Bell, Esq. (484) 270-1435; toll-free at (844) 887-9500; or via e-mail at info@ktmc.com.  If you would like additional information about the suit, please click on the link "Submit Your Information" above and fill out the form as promptly as possible.
 

Please complete this form relating to your transactions for Vroom, Inc. (NASDAQ: VRM) securities between June 9, 2020 and March 3, 2021, inclusive (the “Class Period”).

You may also contact James Maro, Esq. (484) 270-1453 or Adrienne Bell, Esq. (484) 270-1435; or toll free at (844) 887-9500; or you may submit your information via email at info@ktmc.com; or you may click here to print a PDF of this form.

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# of Shares
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# of Contracts
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Did you purchase shares of Vroom, Inc. - VRM prior to the Class Period?
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The submission of this form does not create an attorney-client relationship, nor an obligation on the part of Kessler Topaz or you to file a lead plaintiff motion in this matter. Any information you submit will be maintained as confidential. If Kessler Topaz, in its sole discretion, believes that you might be an appropriate lead plaintiff candidate, Kessler Topaz will contact you to discuss the matter and whether to establish an attorney client relationship. By signing this form you are authorizing us to contact you regarding this case and/or future cases.
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