NEW YORK, April 03, 2024 (GLOBE NEWSWIRE) — Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, is investigating potential claims against Archer-Daniels-Midland Company (NYSE: NYSE:) on behalf of long-term stockholders following a class action complaint that was filed against ADM on January 24, 2024 with a Class Period from April 30, 2020 to January 22, 2024. Our investigation concerns whether the board of directors of ADM have breached their fiduciary duties to the company.
The lawsuit alleges that over the past decade, Archer-Daniels-Midland (ADM) has spent billions of dollars trying to expand its Nutrition business to protect against commodity price volatility in its legacy agricultural commodities trading business.
It is alleged that throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose material facts, about the performance and prospects of ADM’s Nutrition segment and its accounting practices. Specifically, Defendants made positive statements about the Nutrition segment as a future profit-driver for the Company, with the ability to capitalize on healthier eating trends and rising consumer demand for natural ingredients and flavoring. Defendants also created the impression that the Nutrition segment’s growth would provide more diversification and earnings stability for ADM.
Unbeknownst to investors, however, the Nutrition segment’s ostensibly impressive growth was inaccurate and subject to improper accounting practices, and Defendants also downplayed the segment’s eventual decline in 2023. As ADM was aggressively acquiring companies to expand its capabilities in Nutrition, investors were under the impression that the segment was growing rapidly. As alleged, Defendants’ accounting practices for the segment misrepresented its true financial results and prospects, including its operating profits (OP). During the Class Period, Defendants were incentivized to create the appearance of a diversified business by inflating the performance of the Nutrition segment, and the Individual Defendants were further incentivized by stock awards that were directly tied to the performance of the Nutrition segment from 2020 to 2022. As a result, ADM’s business and prospects were much worse than represented by Defendants, causing the price of ADM common stock to trade at artificially inflated levels during the Class Period.
On January 21, 2024, ADM announced that it had placed its CFO…
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