Olo, Inc. Faces Class Action for Their Alleged Misleading Statements That Cost Investors

Olo, Inc. provides software to restaurants to assist with online ordering and food-delivery coordination. On February 12, 2020, Olo announced a partnership with Subway Restaurants to enable more than 20,000 U.S.-based restaurants to handle digital orders from third-party entities such as Uber Eats or DoorDash. Olo then went public by an initial public offering (IPO) in March 2021, offering its shares at $25 per share and opening trading at $32 per share.

According complaints, from August 11, 2021, to August 11, 2022, Olo allegedly made false and/or misleading statements and/or failed to disclose that Subway had chosen to end its contract with Olo, stopping Olo’s key growth metric in its tracks despite Olo’s claims that they were experiencing growth. As a result of this stunted growth and these false/misleading statements, Olo’s investors suffered major losses once the truth was revealed.

The deadline to file for lead plaintiff on this case has passed. If you have any questions regarding this case or are an investor who has suffered losses due to another company’s misconduct, please contact our Securities Litigation team by completing the form.

Investors Were Allegedly Led to Believe Olo’s Partnership with Subway Was Healthy and Growing

McCune Law Group has investigated Olo, Inc. for its actions from August 2021 to August 2022 when it allegedly misled investors as to their success in their partnership with Subway Restaurants. Olo utilized a single key growth metric – active locations – to allegedly claim their company was growing. However, what investors did not realize was Olo’s active locations figures included Subway locations that would imminently cease using Olo’s services. Olo also allegedly failed to disclose that Subway would be ending its relationship with Olo. On August 11, 2022, Olo revealed that 2,500 Subway locations had begun to directly integrate with third-party marketplaces and the remaining 15,00 Subway locations would be removed from Olo’s active locations in the fourth quarter of 2022 and the first quarter of 2023. Because of this announcement, the price of Olo common stock fell by approximately 36%, significantly damaging investors.

Handling This Investigation

Portrait of Elaine S. Kusel, Partner of McCune Law Group
Elaine S. Kusel

Elaine S. Kusel, who joined McCune Law Group, Vercoski, Kusel, Weck, Brandt, APC, (MLG), in 2008 and leads the firm’s New Jersey office. As a nationally renowned class action attorney, she performs a significant role in the firm’s Consumer Fraud Class Action and Securities Litigation divisions.

After graduating from law school, her practice had included fraud litigation, mass torts, and international human rights law. Ms. Kusel has been integral to the successful recovery of multi-million-dollar settlements and verdicts for wronged consumers and investors.

Portrait of Sherief Morsy, Associate of McCune Law Group
Sherief Morsy

Sherief Morsy joined the McCune Law Group, Vercoski, Kusel, Weck, Brandt, APC, (MLG), New Jersey office in 2020. His practice primarily focuses on consumer fraud class actions, Securities Litigation, and other complex litigation matters.

Prior to joining the firm, Mr. Morsy was a senior associate at a New York City law firm, whose practice focused on complex civil and class action litigation, including securities litigation, antitrust litigation, and consumer class actions. As he previously assisted investors in recovering their losses resulting from corporate securities fraud, he now focuses that experience at McCune Law Group in assisting people who have been victimized by deceptive business practices or other corporate wrongdoing.

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