El Pollo Loco investors may receive additional information about the case by clicking the link "Join this Class Action" above.
According to the complaint, El Pollo Loco is headquartered in Costa Mesa, California. Through its subsidiary, El Pollo Loco, Inc., El Pollo Loco develops, franchises, licenses, and operates quick-service restaurants under the El Pollo Loco name in the United States.
The complaint alleges that during the Class Period, the defendants made false and misleading statements and/or failed to disclose adverse information about El Pollo Loco’s business and prospects, including that traffic at El Pollo Loco stores had declined substantially due to the removal of the value items from the restaurants’ menu boards, and that as a result, comparable store sales were not growing at 3%, much less the 3% to 5% the defendants had led investors to believe they would grow in the second quarter of 2015.
As a result of these false and misleading statements and/or omissions, El Pollo Loco securities traded at artificially inflated prices during the Class Period, with the Company’s stock price reaching a high of $25.37 per share.
The Class Period starts on May 15, 2015. El Pollo Loco issued a release announcing its first quarter 2015 financial results for the three-month period ended April 1, 2015 following the close of trading on the evening of May 14, 2015. The company reported that its total revenue had increased 11.1% to $90.4 million in the first quarter of 2015, compared to $81.4 million reported in the first quarter of 2014, emphasizing that that revenue increase was driven by “[s]ystem-wide comparable restaurant sales [having grown] 5.1%, including a 3.5% increase for company operated restaurants, and a 6.2% increase for franchised restaurants.”
According to the complaint, after the close of trading on August 13, 2015, the company issued a release announcing its second quarter 2015 results for the three-month period ended July 1, 2015. El Pollo Loco disclosed that contrary its prior claims of being on track to achieve 3%-5% comparable store sales increases, second quarter 2015 “[s]ystem-wide comparable restaurant sales [had grown] 1.3%, including a 0.5% decrease for company-operated restaurants, and a 2.6% increase for franchised restaurants.”
Following this news, the price of El Pollo Loco’s shares declined by 20% from its closing price of $18.36 per share on August 13, 2015, to $14.56 per share on August 14, 2015.
If you are a member of the class described above, you may no later than October 23, 2015, 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. Any member of the purported class may move the court to serve as a lead plaintiff through counsel of their choice, or may choose to do nothing and remain an inactive class member.
Kessler Topaz Meltzer & Check, LLP has not filed a complaint in this matter. 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.
Kessler Topaz Meltzer & Check, LLP
James Maro, Esq.
Adrienne Bell, Esq.
280 King of Prussia Road
Radnor, PA 19087
1-888-299-7706 (toll free) or 1-610-667-7706