A Bed Bath & Beyond executive who plunged to his death on Friday stood accused in a lawsuit—along with activist investor Ryan Cohen—of participating in a “pump and dump” scheme to artificially inflate the company’s value.
The beleaguered home goods retailer confirmed the death of CFO Gustavo Arnal on Sunday after a New York Post report stated he was the previously unidentified man who “jumped” from the iconic “Jenga” skyscraper in Manhattan.
The class-action lawsuit, filed on Aug. 23—11 days before Arnal’s death—in the U.S. District Court for the District of Columbia lists the lead plaintiff as Pengcheng Si. The company said it was “in the early stages of evaluating the complaint, but based on current knowledge the company believes the claims are without merit,” according to Reuters.
The lawsuit alleges Cohen approached Arnal about a plan to control shares of the company so they could both profit. Bed Bath & Beyond shares have been considered a meme stock in recent months, with a highly volatile price driven in no small part by social media sentiment.
“With control over a significant portion of the public float, Cohen would essentially act as a price support for the stock while Gustavo would act in a similar capacity by controlling the sale of shares by Insiders,” the lawsuit states, according to Fox Business. “Under this arrangement, defendants would profit handsomely from the rise in price and could coordinate their selling of shares to optimize their returns.”
Arnal sold just over 55,000 shares in the company over a few days last month for about $1.4 million, but he still had nearly 255,400 remaining, according to Reuters.
As Coins2Day reported earlier, Cohen bought millions of shares in the company—raising hopes among retail investors he would help turn the retailer around—before completely withdrawing his position last month.
Bed Bath & Beyond declined to comment to Coins2Day about the lawsuit, requesting respect for Arnal’s family and their privacy.