Expanded securities class action filed against Driven Brands Holdings over restatements and weak internal controls

National shareholder rights law firm Hagens Berman says it has filed a securities class action lawsuit related to an earlier case against Driven Brands Holdings Inc. (NASDAQ: DRVN) and several of its top executives. The related action expands the class period and seeks to represent investors who purchased or otherwise acquired Driven Brands common stock between May 3, 2023 and February 24, 2026.

The lawsuit follows Driven Brands’ disclosures on February 25 and February 26, 2026 that investors should no longer rely on previously filed financial statements that required restatement, and that the company would not timely file its annual report for the year ended December 27, 2025.

After the disclosures, Driven Brands shares fell $5.61, or 33%, over the three trading days ended February 27, 2026, eliminating more than $900 million in market capitalization.

Expanded class period and key dates

• Expanded Class Period: May 3, 2023 – Feb. 24, 2026
• Lead Plaintiff Deadline: May 8, 2026

What the complaints allege

According to the firm, the litigation centers on Driven Brands’ past assurances that its financial statements complied with applicable accounting rules and that its internal control over financial reporting was effective.

In contrast, the initial and related complaint alleges that Driven Brands and other defendants misled investors about the company’s financial health by issuing misstated financial statements from fiscal year 2023 through the first three quarters of fiscal year 2025.

Timeline of disclosures

The “truth” emerged before the market opened on February 25, 2026, when Driven Brands admitted that the previously filed financial statements were materially misstated, should no longer be relied upon, and would be restated. The company cited improper accounting in areas including lease adjustments, cash adjustments, expense classification, and other matters, including inappropriately recognized revenue.

Then, after hours on February 26, 2026, Driven Brands announced it would not timely file its annual report for the year ended December 27, 2025 due to the pending restatements. The company also said its internal control over financial reporting was not effective and materially weak.

As of the firm’s notice, Driven Brands had not filed its restatements, leaving investors without information on the severity of the alleged improper accounting.

Market impact and firm’s position

Hagens Berman said it continues to investigate claims that Driven Brands violated federal securities laws and encouraged investors with substantial losses to submit their losses before the May 8, 2026 lead plaintiff deadline.

“The Driven Brands case alleges a fundamental failure of corporate oversight and financial transparency,” said Reed Kathrein, the Hagens Berman partner leading the firm’s investigation of the claims alleged in the pending suits.

Whistleblower information

The firm also said persons with non-public information regarding Driven should consider options to assist the investigation or take advantage of the SEC Whistleblower program. Under the program described by the firm, whistleblowers who provide original information may receive rewards totaling up to 30% of any successful recovery made by the SEC.

About Hagens Berman

Hagens Berman is a global plaintiffs’ rights complex litigation firm focused on corporate accountability. The firm says it represents investors and whistleblowers, as well as workers and consumers, and that its team has secured more than $2.9 billion in this area of law.