Beauty Company ‘Coty’ Faces Lawsuit For Allegedly Deceiving Shareholders Concerning Kylie Cosmetics
The beauty company that bought a 51% majority of Kylie Jenner’s Kylie Cosmetics stock is being sued for allegedly overpaying for “inflated” Kylie Cosmetics, deceiving its shareholders.
According to reports, the speculation surrounding Kylie Cosmetics began to surface in May 2020, just two years after the business and technology magazine Forbes’ called her “youngest-ever self-made billionaire,” after Coty, Inc. acquired a 51 percent stake in her cosmetics collection in exchange for $600 million, valuing the company at $1.2 billion.
In the Forbes article entitled, “Inside Kylie Jenner’s Web of Lies,” the magazine questioned the validity of the business’s worth, asserting that inaccurate numbers about the size of the Kylie Cosmetics business have been circulating for years.
“Jenner and her team had been “inflating the size and success of her [Kylie Cosmetics] business for years.”
Kylie took to her Instagram to slam the magazine and allegations,
“I thought this was a reputable site.”
Reportedly, Coty and several of its highly-ranked officers and directors (the “defendants”) are now being accused of running afoul of U.S. federal securities laws in connection with the acquisition of Kylie Jenner’s cosmetics collection. Now, in a class action lawsuit filed Sep. 4, a Coty shareholder, Crystal Garrett-Evans argued that
“a fraudulent scheme and course of business that operated [to deceive] purchasers of Coty shares by disseminating materially false and/or misleading statements and/or concealing material adverse facts … about Coty’s business, operations, and prospects.”
Neither Kylie Jenner nor Kylie Cosmetics have been named in the suit and a rep for Coty has not made a public statement.
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