Cintas Corp.

On November 13, 2019, Spruce Point Capital Management (“Spruce Point”) issued a report alleging, based on information from FOIA requests, that “Cintas’ Fire Protection Services was charged with fraud and is causing a public safety hazard by having workers conduct fire and safety inspections without proper licenses or permits, and falsifying inspections.” Spruce Point also alleged that management may have misreported revenue and expenses for G&K Services, Inc., which the Company had acquired in 2017 for $2.1 billion.

On this news, Cintas' stock price fell $3.61 per share to close at $255.24 per share on November 13, 2019, thereby injuring investors.

The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that Cintas never tracked legacy margins following the G&K acquisition; (2) that the Company has systematically provided guidance with which it would outperform (a "Beat and Raise" scheme); (3) that undisclosed to the investing public, the Company has breached the law multiple times; (4) that as a result of publicly known and undisclosed breaches of law, the Company's Credit Agreement may be jeopardized; and (5) that, as a result of the foregoing, the Company's financial statements were materially false and misleading at all relevant times.