Bragar Eagel & Squire is Investigating Certain Officers and Directors of FIGS, and Opendoor on Behalf of Long-Term Stockholders and Encourages Investors to Contact the Firm


NEW YORK, April 23, 2023 (GLOBE NEWSWIRE) -- Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, is investigating certain officers and directors FIGS, Inc. (NYSE: FIGS), and Opendoor Technologies, Inc. (NASDAQ: OPEN) on behalf of long-term stockholders. More information about each potential case can be found at the link provided.

FIGS, Inc. (NYSE: FIGS)

Bragar Eagel & Squire is investigating certain officers and directors of FIGS, Inc. following a class action complaint that was filed against FIGS on December 8, 2022.

Founded in 2013, FIGS is a direct-to-consumer healthcare apparel and lifestyle brand that primarily sells its products in the United States through the Company’s digital platforms. While FIGS is best known for its medical scrubs, it also offers other healthcare apparel including lab coats, outerwear, activewear, loungewear, compression socks, footwear, and masks.

On June 1, 2021, FIGS announced the closing of its IPO. Pursuant to the IPO Offering Materials (as defined herein), Defendants issued to the public 30,344,317 shares of FIGS Class A common stock, including the full exercise of the underwriters’ option to purchase an additional 3,957,954 shares, at a price of $22 per share. Of those shares, FIGS sold 4,636,364 shares, and the remaining 25,707,953 shares were sold by Tulco, LLC (“Tulco”), the Company’s largest stockholder.

All sales were issued pursuant to the IPO Offering Materials. However, the IPO Offering Materials and documents incorporated by reference therein contained untrue statements of material fact and omitted to state material facts that were required by applicable law and necessary to make the statements therein not misleading. In particular, the IPO Offering Materials stated that the Company’s Direct-to-Consumer (“DTC”) strategy provides “valuable real-time customer data” that “leads to operational efficiencies throughout our supply chain, inventory management and new product development.”

On September 14, 2021, FIGS issued a press release announcing the SPO, through which Defendants Tulco, Heather Hasson (“Hasson”), and Catherine Spear (“Spear”) would offer for sale approximately 8.8 million shares of FIGS Class A common stock.

On September 20, 2021, Defendants Tulco, Hasson, and Spear completed the SPO. Pursuant to the SPO Offering Materials (as defined herein), Defendants Tulco, Hasson, and Spear issued to the public 8,917,385 shares of FIGS Class A common stock, including the full exercise of the underwriters’ option to purchase an additional 1,337,607 shares, at a price of $40.25 per share.

All sales in the SPO were issued pursuant to the SPO Offering Materials. However, the SPO Offering Materials and documents incorporated by reference therein contained untrue statements of material fact and omitted to state material facts that were required by applicable law and necessary to make the statements therein not misleading. In particular, the SPO Offering Materials reiterated that the Company’s access to significant customer data led to “operational efficiencies throughout [its] supply chain [and] inventory management.” The SPO Offering Materials also stated that the Company’s DTC strategy allowed FIGS to leverage customer data “in all aspects of our business, including apparel design and merchandising, customer acquisition and retention, demand forecasting and inventory optimization.”

The truth began to be revealed on December 10, 2021, before the market opened, when FIGS announced that its Chief Financial Officer (“CFO”) Jeffrey D. Lawrence, would be resigning effective December 24, 2021, less than one year after becoming CFO. In response to this news, the price of FIGS stock declined by $6.57 per share, or over 21%, from a closing price of $31.22 per share on December 9, 2021, to a closing price $24.65 per share on December 10, 2021, on unusually high trading volume.

Then, on May 12, 2022, after the market closed, FIGS announced disappointing financial results and slashed its expected sales, gross margin, and adjusted earnings before interest, taxes, depreciation, and amortization (“EBITDA”). FIGS attributed the poor financial results to “inventory constraints” which the Company stated were “the primary factor affecting our outlook for the full year.” In response to this news, the price of FIGS stock declined by $3.21 per share, or nearly 25%, from a closing price of $12.85 per share on May 12, 2022, to a closing price of $9.64 per share on May 13, 2022, on unusually high trading volume.

As a result of Defendants’ wrongful acts and omissions, and the resulting decline in the market value of FIGS stock, Plaintiff and other Class members have suffered significant losses and damages.

To learn more about our investigation into [company 1] go to: https://bespc.com/cases/FIGS

Opendoor Technologies, Inc. (NASDAQ: OPEN)

Bragar Eagel & Squire is investigating certain officers and directors of Opendoor Technologies, Inc. following a class action complaint that was filed against Opendoor on October 7, 2022.

Opendoor was formerly known as Social Capital Hedosophia Holdings Corp. II (“SCH”) and operated as a special purpose acquisition company (“SPAC”), also called a blank-check company, which is a development stage company that has no specific business plan or purpose or has indicated its business plan is to engage in a merger or acquisition with an unidentified company or companies, other entity, or person.

On September 15, 2020, the Company, then still operating as SCH, and Legacy Opendoor, a private company operating as a digital platform for residential real estate, announced their entry into a definitive agreement for the Merger (the “Merger Agreement”), which valued Legacy Opendoor at an enterprise value of $4.8 billion.

On October 5, 2020, the Company filed a registration statement on Form S-4 with the SEC in connection with the Merger, which, after several amendments, was declared effective by the SEC on November 27, 2020 (the “Registration Statement”). On November 30, 2020, the Company filed a proxy statement/prospectus on Form 424B3 with the SEC in connection with the Merger, which formed part of the Registration Statement (the “Proxy” and, together with the Registration Statement, the “Offering Documents”).

On December 18, 2020, pursuant to the Merger Agreement, the Company, among other things, deregistered as a Cayman Islands company, registered as a Delaware company, changed its name to “Opendoor Technologies Inc.”, and consummated the Merger, whereby, among other things, Legacy Opendoor became a wholly owned subsidiary of the Company.

Following the Merger, the Company has operated a digital platform for buying and selling residential real estate in the U.S. The Company’s platform features a technology known as “iBuying,” which is an algorithm-based process that purportedly enables Opendoor to make accurate market-based offers to sellers for their homes, and then flip those homes to buyers for a profit.

On December 21, 2020, the Company’s post-Merger common stock and warrants began publicly trading on the Nasdaq Stock Market (“NASDAQ”) under the ticker symbols “OPEN” and “OPENW”, respectively.

On September 19, 2022, citing a review of industry data, Bloomberg reported that the Company appeared to have lost money on 42% of its transactions in August 2022 (as measured by the prices at which it bought and sold properties). Bloomberg further reported that the data was even worse in key markets such as Los Angeles, California, where Opendoor lost money on 55% of sales, and Phoenix, Arizona, where it lost money on 76% of sales. Worse, a global real estate tech strategist interviewed by Bloomberg, Mike DelPrete, predicted that, based on his analyses, September would likely be even worse for Opendoor than August. Bloomberg’s findings evidenced the failure of Opendoor’s algorithm to adjust accurately to changing market conditions.

Following the Bloomberg report, Opendoor’s stock price fell $0.50 per share, or 12.32%, over the following two trading sessions, to close at $3.56 per share on September 20, 2022 – an 88.61% decline from the Company’s first post-Merger closing stock price of $31.25 per share on December 21, 2020 (the “Initial Closing Price”).

As of the time the complaint was filed, Opendoor’s common stock was trading significantly below the Initial Closing Price and continues to trade below its initial value from the Merger, damaging investors.

According to the complaint, the Offering Documents for the Merger were negligently prepared and, as a result, contained untrue statements of material fact or omitted to state other facts necessary to make the statements made not misleading and were not prepared in accordance with the rules and regulations governing their preparation. Additionally, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operations, and prospects. Specifically, the Offering Documents and Defendants made false and/or misleading statements and/or failed to disclose that: (i) the algorithm (“Algorithm”) used by the Company to make offers for homes could not accurately adjust to changing house prices across different market conditions and economic cycles; (ii) as a result, the Company was at an increased risk of sustaining significant and repeated losses due to residential real estate pricing fluctuations; (iii) accordingly, Defendants overstated the purported benefits and competitive advantages of the Algorithm; and (iv) as a result, the Offering Documents and Defendants’ public statements throughout the Class Period were materially false and/or misleading and failed to state information required to be stated therein.

To learn more about our investigation into Opendoor go to: https://bespc.com/cases/OPEN

About Bragar Eagel & Squire, P.C.:
Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York, California, and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.

Contact Information:
Bragar Eagel & Squire, P.C.
Brandon Walker, Esq.
Melissa Fortunato, Esq.
Marion Passmore, Esq.
(212) 355-4648
investigations@bespc.com
www.bespc.com