Estee Lauder Allegedly Hid Impacts of Asia Reseller Crackdown

The Estee Lauder Cos., CEO Fabrizio Freda, and chief financial officer Tracey Travis concealed the cosmetic giant’s reliance on the reseller market before a regulatory crackdown across Asia slowed sales, a shareholder class action says.

Revenue growth before February 2022 was largely driven by purchases made by resellers, who bought large amounts of cosmetics in duty-free stores to then sell in China and Korea at discount prices, which the company didn’t disclose to investors before governmental restrictions hindered sales in the region, according to the complaint filed Monday in US District Court for the Southern District of New ...