COVID Restaurants – Cheesecake Factory SEC COVID-disclosure charges

By | December 4, 2020

 

Agency says settlement is the first for public company in reporting pandemic impact

The Cheesecake Factory Inc. has agreed to pay $125,000 in a settlement with the Securities and Exchange Commission over misleading disclosures about the impact of the COVID-19 pandemic on its business.

The SEC, in a statement Friday, said the settlement was the first result of charges against a public company linked to the financial effects of the pandemic and violations of federal securities law reporting provisions.

The SEC said Calabasas Hills, Calif.-based Cheesecake Factory, in federal filings on March 23 and April 3, stated that its restaurants were “operating sustainably” during the COVID-19 pandemic.

However, the SEC said the filings “were materially false and misleading because the company’s internal documents at the time showed that the company was losing approximately $6 million in cash per week and that it projected that it had only 16 weeks of cash remaining.”

Read full article