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U.S. District Judge Katherine Polk Failla presiding in the District Court of Manhattan, dismissed the lawsuit claiming fraud by shareholders for alleged failure by Chipotle management to reveal details and the impact of successive food borne infections. The case was captioned Ong et al v Chipotle Mexican Grill Inc et al U.S. District Court, Southern District of New York, #16-00141.
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The judgment included the statement “There is no indication in the complaint that Chipotle’s projections were inconsistent with or did not account for the company’s assessment of the impact of the food-borne illness outbreaks.” The judgment continued “As long as the public statements are consistent with reasonably available data, corporate officials need not present an overly gloomy or cautious picture of current performance or future prospects.”
The judgment also dismissed claims against CEO Steve Ells and former co-CEO Monty Moran and CFO John Hartung alleging that they intended to commit fraud by making sales of more than $200 million of Chipotle stock during the three months before the outbreak.
The Plaintiffs in the case included the Construction Laborers Pension Trust of Greater St. Louis and Metzler Investment GMBH of Germany.