Aeropostale's False Statements Caused Stock Dive: Suit

Law360, New York (October 27, 2011, 3:39 PM EDT) -- Shareholders hit Aeropostale Inc. with a derivative suit Tuesday in New York court, alleging the retailer's management misled investors about the company's business prospects, sending its stock price tumbling.

The mall-based, youth-oriented retailer allegedly talked up its 2011 growth prospects from Feb. 3 to Aug. 3, even though it knew negative trends were already brewing in its bottom line — especially in its retail fashion lines.

On Feb. 3, the company issued a press release saying its net sales for January 2011 had risen 7 percent...
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