Yochanan Markman, a Whole Foods shareholder, filed a complaint in federal court in Austin, Texas, on August 6 against Whole Foods co-CEOs Walter Robb and John Mackey, chief financial officer Glenda Flanagan, and the company.
The complaint alleges that Whole Foods committed securities fraud by concealing its overcharging of New York City customers, which led to bad publicity that hurt sales and drove its share price down, according to Reuters.
The complaint also claims that Whole Foods “recklessly disregarded” that they overstated the weight of pre-packaged products, which led to overcharges. The company’s public statements about operations and prospects were allegedly also “false and misleading.”
Whole Foods spokesman Michael Silverman disagrees with the complaint, telling Reuters, “We have upheld our responsibility to our stakeholders, and are confident that this complaint is baseless and without merit.”
Customers have sued Whole Foods for overcharges, but this is the first lawsuit filed by a shareholder.