Class Action Sued The Simply Good Foods Over Failed OWYN Integration
News related to:The Simply Good Foods Company · 2 min read
SAN DIEGO, Sept. 11, 2026 /CourierPR/ -- Robbins LLP, a shareholder rights law firm, has reminded investors that a class action lawsuit has been filed against The Simply Good Foods Company (NASDAQ: SMPL) on behalf of shareholders who purchased the company's stock between October 24, 2024, and April 8, 2026. The lawsuit alleges that the company misled investors regarding the successful integration of OWYN, a company acquired in an all-cash transaction worth $280 million.
According to the complaint, The Simply Good Foods Company initially claimed that the acquisition of OWYN offered several strategic and financial benefits, including diversification of the company's portfolio. However, the lawsuit contends that the integration of OWYN has been a complete failure. Specifically, the complaint alleges that the company failed to disclose several key issues:
1. Loss of Key Managerial Personnel: The company allegedly lost key managerial personnel following the acquisition, which impaired its ability to achieve the strategic initiatives and financial targets set by the acquisition. 2. Increased General and Administrative Spending: To compensate for the loss of key personnel, the company reportedly increased its general and administrative spending, leading to an inefficient and bloated organizational structure. 3. Product Quality Issues: The addition of a new pea protein supplier for OWYN formulations prior to the acquisition created significant product quality issues, negatively impacting the taste, texture, and shelf-life of OWYN products. 4. Short-Term Sales Boosts: To boost sales in the short-term, the company offered discounts and engaged in other promotional activities, which eroded its margins and failed to achieve the desired sales turnaround. 5. Reduced Brand Support: To mitigate the margin erosion, the company cut brand support and marketing for OWYN, further depressing product sales.
These issues led to disappointing second-quarter earnings results on April 9, 2026. The company reported a 17% year-over-year contraction in OWYN's quarterly sales, a $187 million impairment charge against its OWYN brand intangible assets, and a significant reduction in its 2026 net sales outlook. The stock price of The Simply Good Foods Company declined from $14.41 per share on April 8, 2026, to $10.44 per share on April 10, 2026, a drop of more than 27% over a two-day trading period.
On July 9, 2026, the company reported an additional $13 million impairment of its OWYN assets, bringing the cumulative impairments to $200 million, 70% of the purchase price less than two years after the acquisition closed.
Investors who purchased or otherwise acquired The Simply Good Foods Company securities between October 24, 2024, and April 8, 2026, and suffered significant losses during this period may be eligible to participate in the lawsuit. The deadline for seeking appointment as lead plaintiff is October 13, 2026. Robbins LLP, a shareholder rights law firm, is representing investors on a contingency fee basis and can be contacted for more information.
The lawsuit seeks to represent the interests of all class members throughout the litigation. Investors who do not seek appointment as lead plaintiff may remain absent class members if the case proceeds and later resolves successfully.