Cava Group is facing a $2.2 billion shareholder lawsuit accusing its founders and board members of selling huge amounts of stock while hiding signs of its slowing growth. The complaint, made public on July 28 after initially being filed under seal, claims insiders cashed out just before the company disclosed weaker business performance.
The Cleveland Bakers and Teamsters Pension Fund filed the suit, alleging that entities linked to Belgian billionaire Eric Wittouck sold nearly $1.8 billion in shares between August 2024 and March 2025. Other insiders, including co-founder Ronald Shaich, reportedly sold around $500 million more, with Shaich’s sales accounting for about $330 million. These sales happened months before Cava began revealing that its post-IPO growth was decelerating.
At the time, Cava’s leadership allegedly continued presenting a strong growth outlook despite knowing the momentum was fading due to challenges in the fast-casual dining sector. The company’s stock surged as high as $150 after its 2023 IPO, fueled by investor enthusiasm that it could replicate Chipotle’s success in Mediterranean cuisine. Yet, by late July 2026, shares had dropped to $64.54, less than half their peak value.
The lawsuit highlights how Wittouck’s affiliates, early major backers with a fortune rooted in European sugar refining, rapidly offloaded their stakes just ahead of the public acknowledgment of slowing growth. This timing is central to the case’s argument that insiders took advantage of nonpublic information to exit before investors felt the impact.
This information is provided for educational purposes and is not financial advice.
