Starbucks Must Face Shareholder Lawsuit Over Surprise Sales Decline

Starbucks must face a lawsuit claiming it defrauded shareholders by concealing declining sales in the United States and China, its largest markets, leading to a 16% drop in its stock price after the coffee chain revealed the unexpected weakness.

In a decision late on Wednesday, U.S. District Judge John Chun in Seattle said shareholders can try to prove Starbucks intentionally misled them in a January 2024 analyst call by touting successes in its "reinvention plan."

These included statements that upgrades in equipment, staffing and...

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