GPGI Faces Class Action Lawsuit for Alleged Securities Fraud over Acquisition of Husky

Source: Global Markets Broadcast

Several law firms have recently filed a class-action securities fraud lawsuit against GPGI, alleging that it exaggerated the value of its acquisition target, Husky Technologies, and misled investors during the transaction process. Formerly known as CompoSecure, GPGI originally operated in fintech and security. After completing the acquisition of Husky in January 2026, the company was renamed GPGI.

The lawsuit covers investors who purchased GPGI shares between November 3, 2025, and May 6, 2026. The complaint states that the defendants significantly overestimated Husky's value in their proxy statement, that revenue and adjusted EBITDA targets lacked objective factual basis, and that a primary motivation for the deal was to generate millions of dollars in fees for affiliated entity Resolute Holdings and individual defendants, rather than to create long-term value for shareholders.

On February 26, 2026, the short-selling agency Jehoshaphat Research released a report accusing GPGI of inflating Husky’s value to secure shareholder approval for the acquisition. Following the publication of the report, GPGI's stock price fell from $23.12.

The financial data subsequently released by the company confirmed market concerns. The earnings report announced on March 12 showed Husky’s adjusted EBITDA margin for the fourth quarter compressed from 29.3% to 26.1%. GPGI’s share price dropped 16% within two days. On May 7, the company disclosed that Husky’s adjusted net sales for the first quarter had decreased by 5.2% year-on-year, adjusted EBITDA plummeted by 40.2%, and it dramatically lowered its guidance for the full year 2026, causing the stock to drop nearly 26% on the same day.

Investors must apply to the court to serve as lead plaintiff by September 14 or 15, 2026. Multiple law firms are encouraging affected investors to contact them for consultation.