The litigation targets the company’s 2024 purchase of Only What You Need, Inc. for $280 million. According to the complaint, Simply Good failed to disclose that a pea protein sourcing error—made prior to the acquisition's close—degraded product quality as inventory aged. These taste and texture issues sparked negative consumer reviews and a sharp sales decline, forcing the company to slash its fiscal 2026 sales guidance. When the financial impact of these issues surfaced in October 2025, the company's share price dropped by more than 17%.
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Simply Good Foods Faces Class Action Over OWYN Acquisition Failures
Investors who lost over $100,000 in The Simply Good Foods Company stock have until October 13, 2026, to apply as lead plaintiffs in a pending class action lawsuit. The case, filed in the Southern District of New York, centers on allegations that executives concealed material product defects following a major acquisition.
Further disclosures in April 2026 exacerbated the situation, as the company reported a 17% year-over-year contraction in OWYN sales and recorded a $187 million impairment charge. This second wave of negative news triggered an additional 27% decline in share price over two trading days. Shareholders affected by these losses between October 24, 2024, and April 8, 2026, are being represented by Kahn Swick & Foti, LLC in the case of Monroe County Employees' Retirement System v. The Simply Good Foods Company.
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