Judge Approves Estée Lauder’s $210 Million Investor Settlement

A federal judge approved Estée Lauder’s $210 million investor settlement on Oct. 14, resolving investors’ allegations that the company overstated growth prospects and did not fully disclose how China’s daigou crackdown affected its business. Investors brought claims against Estée Lauder and former executives Fabrizio Freda, its former CEO, and Tracey Travis, its former CFO. They alleged that the company’s growth outlook left out the full effect of Chinese authorities’ crackdown on the resale trade. The claims arose as Estée Lauder was recovering from pandemic disruptions. Daigou involves shoppers buying luxury goods at discounted or duty-free prices and reselling them, often in mainland China. Investors alleged that the trade helped support sales in Hainan.

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