CNBC’s Lemonis Wins Appeal in Camping World Insider Trading Case

CNBC host Marcus Lemonis and other Camping World Holdings Inc. board members are free of insider trading litigation after Delaware’s top court rejected investor claims that he sold tens of millions worth of stock while hiding problems integrating an acquisition.

The state’s justices upheld a decision by Vice Chancellor Lori W. Will, who dismissed the case in January from Delaware’s Chancery Court. Will held that the investors leading the case had no excuse for failing to request a board investigation first, generally a prerequisite to filing a shareholder derivative lawsuit.

Although the allegations about Lemonis “perhaps come closest” to showing wrongdoing, the suit stumbled at the threshold because at least six members of the nine-seat board didn’t face any personal legal exposure, while at least five were independent of Lemonis, Will said at the time.

The case, which began in 2019, stemmed from Camping World’s 2017 acquisition of bankrupt sporting goods retailer Gander Mountain Co. The lawsuit was filed by a police pension fund and an individual investor.

In addition to Lemonis, who hosts the business-rescue reality show “The Profit,” it targeted the rest of the board at the time, along with affiliates of Crestview Partners LP, a major investor in Camping World, the country’s largest RV dealership chain.

The suit accused Crestview affiliates and a Lemonis investment vehicle of making insider stock sales worth $172 million and $32 million, respectively, while the board looked the other way and concealed delays in reopening former Gander stores.

Dismissing those claims, Will said none of the allegations showed that Crestview’s appointees to the Camping World board had inside information at the time of its stock sales, which followed negative public disclosures rather than preceding them.

The Delaware Supreme Court issued a one-page ruling affirming the decision “on the basis of and for the reasons assigned by the Court of Chancery.” Justices Gary F. Traynor, Karen L. Valihura, and James T. Vaughn Jr. presided over the appeal.

Lemonis, Camping World, and the other board members were represented by Richards, Layton & Finger PA and Latham & Watkins LLP. The investors were represented by Young Conaway Stargatt & Taylor LLP and Robbins LLP.

The case is In re Camping World Holdings Inc. Stockholder Deriv. Litig., Del., No. 52, 2022, 10/13/22.