Aramark, Vestis Lose Bid to Toss Investor Suit Over Performance

Vestis Corp. investors adequately alleged the uniform rental company misled them about operational problems and customer retention before poor financial results caused a 45% stock drop, a federal court ruled.

The investors can also proceed with claims against Aramark, which spun Vestis off in 2023, Judge Steven D. Grimberg said in an opinion docketed Wednesday in the US District Court for the Northern District of Georgia. Grimberg distinguished the situation from cases involving mergers.

The investors alleged on behalf of a proposed class that before and after the 2023 spinoff, executives painted a rosy picture of Vestis’ prospects. It ...