Law360 recently has reported on a shareholder derivative action filed in the U.S. District Court for the Southern District of New York against certain current and former officers and directors of The Estée Lauder Companies Inc.
According to the Law360 article, plaintiff alleges that company officials made materially false or misleading statements concerning Estée Lauder’s business operations between February 3, 2022 and October 31, 2023, including statements concerning the company’s Asia travel retail business and its alleged reliance on prohibited duty-free “gray market,” or “daigou,” sales in China and South Korea.
Per the article, the complaint alleges defendants misrepresented the source of the company’s travel-retail revenue and the reasons for declines in net sales in its Asia travel retail segment. The complaint further alleges that, after disclosures concerning the company’s travel retail business, Estée Lauder’s stock declined nearly 19% on November 1, 2023.
The derivative complaint asserts claims including alleged violations of the Exchange Act, breach of fiduciary duty, aiding and abetting breach of fiduciary duty, unjust enrichment, and waste of corporate assets, and seeks monetary and corporate-governance relief on behalf of Estée Lauder.
Grabar Law Office represents nominal plaintiff in the action. The case is Portia McCollum, derivatively on behalf of nominal defendant, The Estée Lauder Companies Inc. v. William P. Lauder et al., No. 1:26-cv-08242, pending in the U.S. District Court for the Southern District of New York.
A copy of the article can be viewed here: Estee Lauder Hit With Derivative Suit Over Gray Market Sales – Law360
