Robbins LLP is Investigating the Allegations Against LuxUrban Hotels Inc.
Robbins LLP informs investors that a shareholder filed a class action on behalf of all persons and entities that purchased or otherwise acquired LuxUrban Hotels Inc. (NASDAQ: LUXH) securities between November 8, 2023 and February 2, 2024. LuxUrban utilizes an asset light business model to lease hotels on a long-term basis and rent hotel rooms in the properties it leases.
The Allegations: According to the complaint, in November 2023, the Company announced it had signed a 25-year Master Lease Agreement with the prestigious Royalton Hotel, a four star hotel located at 44 West 44th Street, New York, New York.
Plaintiff alleges that on January 17, 2024, Bleeker Street Research published a report alleging that the Company had not actually signed a lease with the Royalton Hotel. The report also alleged the Company was embroiled in a number of lawsuits that “allege LuxUrban failed to pay rent repeatedly,” and “in the last six months has been sued by landlords at four of their properties for unpaid rent” but that LuxUrban had “never once disclosed the nature of these lawsuits.” On this news, the Company’s stock price fell $0.58, or 12% to close at $4.32 on January 17, 2024. The stock price continued to fall an additional $0.42, or 10%, to close at $3.89 on January 18, 2024.
Then on February 2, 2024, LuxUrban announced the “termination of discussions to add the Royalton Hotel to its roster of properties” and that it was “withdrawing its prior statements regarding the Royalton” including prior quarterly reports that listed the Royalton under “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Property Summary—Properties under lease, not operating.” On this news, the Company’s stock price fell $0.99, or 22%, to close at $3.50 per share on February 5, 2024.
What Now: You may be eligible to participate in the class action against LuxUrban Hotels Inc. Shareholders who want to serve as lead plaintiff for the class must file their papers with the court by April 12, 2024. A lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery. If you choose to take no action, you can remain an absent class member.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
