Aaron’s, Inc.

On February 20, 2020, Aaron’s disclosed that its Progressive segment had reached an agreement in principle with the U.S. Federal Trade Commission (“FTC”) regarding the July 2018 civil investigative demand, which had sought to determine whether disclosures related to the Company’s financial products were in violation of the FTC Act. The proposed agreement required Aaron’s to “make a payment of $175 million and enhance certain compliance-related activities, including monitoring, disclosure and reporting requirements.”

On this news, the Company’s share price fell $10.70 per share, or over 19%, to close at $45.45 per share on February 20, 2020, thereby injuring investors.

Throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose: (i) that Aaron’s had inadequate disclosure controls, procedures, and compliance measures; (ii) that, consequently, the operations of Aaron’s Progressive and AB segments were in violation of the FTC Act and/or relevant FTC regulations; (iii) that, consequently, Aaron’s earnings from those segments were partially derived from unlawful business practices and were thus unsustainable; (iv) the full extent of Aaron’s liability regarding the FTC’s investigation into its Progressive and AB segments, Aaron’s noncompliance with the FTC Act, and the likely negative consequences of all the foregoing on the Company’s financial results; and (v) that, as a result, the Company’s public statements were materially false and misleading at all relevant times.