Party City Execs Hid Liquidity Woes Before Bankruptcy, Suit Says

Party City Holdco Inc.'s CEO and chief financial officer signed off on SEC filings that misrepresented its financial health, an owner of the bankrupt retailer’s stock alleges.

“Party City was well aware of its liquidity problems and lending shortfalls” before it filed a 10-Q form with the Securities and Exchange Commission in November 2022, shareholder Ryan Shulman says in a proposed class action. He filed the suit Tuesday in the US District Court for the District of New Jersey.

The suit comes shortly after Party City said in bankruptcy court that it’s retaining documents and data in connection with an ...