Advance Auto Board Hit With Insider Trading, Stock Juicing Suit

The senior leaders of Advance Auto Parts Inc., North America’s top aftermarket car parts retailer, were hit with a Delaware lawsuit Friday claiming they spent years lying about its finances following a board coup by activist hedge fund Starboard Value LP while its CEO sold stock at inflated prices.

Starboard-linked CEO Thomas R. Greco and board chairman Jeffery C. Smith, who is also Starboard’s CEO, ignored internal projections and “invented an earnings scenario” that was “a top down C-suite fallacy, a set of targets with no basis in reality,” the Chancery Court complaint says.

When they “finally rescinded the ...