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FIGS, Inc.

Bernstein Liebhard LLP announces that a securities class action lawsuit has been filed on behalf of investors who purchased or acquired FIGS, Inc. (“FIGS” or the “Company”) (NYSE: FIGS) securities between May 27, 2021 and May 12, 2022, inclusive; and/or (ii) FIGS stock pursuant and/or traceable to the Offering Documents issued in connection with FIGS’ initial public offering.  The lawsuit seeks to recover FIGS shareholders’ investment losses.

If you purchased FIGS securities between May 27, 2021 and May 12, 2022, inclusive; and/or (ii) FIGS stock pursuant and/or traceable to the Offering Documents issued in connection with FIGS’ initial public offering, and would like to discuss your legal rights and/or options, please click “Join Class Action” above.

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 such as lab coats, underscrubs, outerwear, activewear, loungewear, compression socks, footwear, and masks.

On June 1, 2021, FIGS announced the closing of its IPO.  Pursuant to the Registration Statement, defendants issued to the public 30,344,317 shares of Class A common stock, including the full exercise of the underwriters option to purchase an additional 3,957,954, at the price of $22 per share.  The offering consisted of 4,636,364 shares sold by FIGS and 25,707,953 shares sold by Tulco, LLC (“Tulco”), the Company’s largest stockholder.

All the sales were issued pursuant to the Registration Statement.  The Registration Statement 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 Registration Statement misleadingly claimed that due to the Company’s access to significant customer data, it was able to maintain an efficient and steady supply chain.

The truth was, however, that the Company’s access to data did not allow it to mitigate supply chain problems through predictable sales. Instead, FIGS had to increasingly rely on air freight that costs materially more than the overseas shipping it previously relied on.

While the Registration Statement did contain a mention of air freight, this in itself was misleading.  The Registration Statement blamed the COVID-19 pandemic for the use of air freight in the time leading up to the IPO.  The truth, was, however, that FIGS was continually relying on air freight for its business.

Even after the IPO, as the Company continued to rely on air freight, Defendants continued to claim that the Company’s use of air freight was transitory.  For example, Defendants stated that the use of air freight was at its “peak” during the fourth quarter of 2021, and that “we’re pretty confident that we’re going to see less airfreight overall than we’re seeing it in [the fourth quarter] as we get into [2022].”

On May 12, 2022, the Company announced disappointing results and slashed its expected sales, gross margin, and adjusted earnings before interest, taxes, depreciation, and amortization because of these “supply chain” issues.  FIGS also admitted that not only did they continue to rely on air freight during the first quarter of 2022, but that “[f]or the rest of the year, we plan to significantly increase our use of airfreight to reduce our exposure to these unpredictable transit times.”

On this news, the Company’s stock price fell $3.21 per share, or almost 25%, to close just $9.64 per share on May 13, 2022.

If you wish to serve as lead plaintiff, you must move the Court no later than January 3, 2023. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. Your ability to share in any recovery doesn’t require that you serve as lead plaintiff. If you choose to take no action, you may remain an absent class member.

Since 1993, Bernstein Liebhard LLP has recovered over $3.5 billion for its clients. In addition to representing individual investors, the Firm has been retained by some of the largest public and private pension funds in the country to monitor their assets and pursue litigation on their behalf. As a result of its success litigating hundreds of lawsuits and class actions, the Firm has been named to The National Law Journal’s “Plaintiffs’ Hot List” thirteen times and listed in The Legal 500 for ten consecutive years.

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Contact Information:

Peter Allocco
Bernstein Liebhard LLP
(212) 951-2030