Avon Must Face Investor Suit Over Problems With Brazilian Sales

Avon Products Inc. lost its bid to end a would-be class securities suit after a New York federal judge ruled the cosmetics company’s investors plausibly alleged it may have recklessly misled them about its operations in Brazil.

The company, which sells products to representatives who then resell to consumers, didn’t disclose its looser credit terms and lack of training for its Brazilian representatives, the investors said. The detailed allegations are sufficient for the case to move forward, the U.S. District Court for the Southern District of New York said.

Avon argued that none of the challenged statements about credit ...