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Law Office of Robbins Umeda announces investigation of Talbots
07
Feb '11
Robbins Umeda LLP, a shareholder rights litigation firm, has commenced an investigation into possible breaches of fiduciary duty and other violations of the law by certain officers and directors at The Talbots Inc. Talbots, along with its subsidiaries, operates as a specialty retailer and direct marketer of women's apparel, accessories, and shoes in the United States and Canada. The company was founded in 1947 and is headquartered in Hingham, Massachusetts.

Robbins Umeda LLP's investigation concerns whether Talbots's officers and directors caused the company to issue materially false and misleading statements regarding the company's business and financial results. Specifically, the investigation concerns whether these fiduciaries improperly touted the company's rise to profitability and caused the company's stock to trade at artificially inflated prices.

On April 13, 2010, the officers and directors at Talbots released upbeat financial news that the adjusted fourth quarter income from continuing operations had increased to $7.4 million, compared to the prior year's adjusted loss from continuing operations of $123.4 million.

Throughout the remainder of 2010, Talbots continued to release statements regarding the company's positive performance compared to years past. However, on December 7, 2010, Talbots's abruptly reported that net sales for the third quarter of 2010 decreased 3.2%, that the company's comparable store sales were down 7.1%, and an 11.3% increase in total inventory.

Upon this news, Talbots's market value dropped 22.6%. Furthermore, on January 11, 2011, Talbots provided a Business Update which disclosed the company's expected full year adjusted earnings per share to be in the range of $0.56-$0.69 per share, a departure from its previously announced range of $0.70-$0.89 per share. The company's value dropped another 17.4%, following this news.

Robbins Umeda LLP


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