Join the Class Action Suit Against Compass Group Diversified Holdings and Recover Your Losses

Investors Urged to Participate in Class Action Against Compass Group Diversified Holdings

Levi & Korsinsky, LLP is notifying investors in Compass Group Diversified Holdings, LLC (also known as Compass Diversified or CODI) about a significant class action lawsuit that seeks to address losses attributable to alleged securities fraud. This lawsuit specifically pertains to an extensive period from May 1, 2024, to May 7, 2025, during which many investors may have been adversely affected by misleading statements concerning the company’s financial integrity.

Understanding the Lawsuit

The class action aims to represent individuals who invested in Compass Group during this timeframe and suffered losses as a result of the company's alleged failure to disclose crucial information that would have affected investor decisions. Among the allegations is that Compass did not effectively manage its internal controls over financial reporting, which is a critical factor in safeguarding investors against misrepresentation.

A particular point of concern is the lack of transparency surrounding Lugano Holding, Inc., a subsidiary of Compass. The complaint asserts that Compass failed to disclose vital information regarding Lugano's undisclosed financing arrangements, raising red flags about irregularities in sales, cost of sales, inventory, and accounts receivable. Consequently, the company’s optimistic statements regarding its financial health are claimed to be materially misleading.

Significant Revelations

The truth began to surface on May 7, 2025, when Compass announced to its investors that its financial statements from fiscal year 2024 could no longer be deemed reliable. This declaration coincided with an internal investigation led by Compass's Audit Committee focusing on potential irregularities in how Lugano was financing its inventory. Notably, this situation resulted in the resignation of Lugano's founder and CEO, Moti Ferder, who will not receive any severance compensation.

Following this announcement, there was a dramatic drop in stock price, which plummeted from $17.25 per share on May 7, 2025, to a mere $6.55 by the next day. Such a steep decline signifies the severe impact of the company's failed disclosures on its investors and their financial portfolios.

Next Steps for Investors

For those affected by the situation, it's crucial to act promptly. If you believe that you have incurred losses during the indicated period, you have until July 8, 2025, to request the court to recognize you as a lead plaintiff in this class action. However, it is important to note that you are not required to be a lead plaintiff in order to partake in any potential recovery from this lawsuit.

Investors participating in this class action can do so without any out-of-pocket expenses. Any compensation awarded would come without the need to pay court costs or attorneys’ fees upfront, making it accessible for affected parties to seek justice.

Why Choose Levi & Korsinsky?

Levi & Korsinsky has a proven track record in representing investors in complex securities litigation. With nearly two decades of experience, the firm has secured hundreds of millions in recoveries for aggrieved shareholders. They have consistently ranked among the top securities litigation firms in the United States, demonstrating a solid reputation for navigating intricate legal challenges to protect investor rights.

For more information, affected investors can contact Joseph E. Levi, Esq. at Levi & Korsinsky, LLP, via email or phone to discuss their potential claims further.

In conclusion, investors of Compass Group Diversified Holdings must take timely action to protect their rights and secure potential recovery of losses incurred due to alleged securities fraud. By joining this class action lawsuit, investors can harness the collective power of affected parties and hold the company accountable for its apparent missteps in financial reporting.