Driven Brands Lawsuit: $25M Settlement and 2026 Restatement

The Driven Brands lawsuit most investors are asking about is the securities fraud class action that ended in a $25 million cash settlement, given final court approval on June 9, 2026. It covers shareholders who bought Driven Brands Holdings Inc. common stock between October 27, 2021 and August 1, 2023, and claims must be submitted by July 6, 2026.¹² A separate, newer case tied to a 2026 accounting restatement is still in its early stages and is not part of that settlement.

The $25 Million Settlement

The settled case is Genesee County Employees’ Retirement System v. Driven Brands Holdings Inc., filed December 22, 2023 in the U.S. District Court for the Western District of North Carolina (Case No. 3:23-cv-00895). It alleged violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 against Driven Brands, former CEO Jonathan Fitzpatrick, and former CFO Tiffany Mason.³⁴

A federal judge ruled in February 2025 that the plaintiffs’ allegations were adequately pleaded to survive dismissal. The parties reached the $25 million cash settlement on December 19, 2025. The court granted preliminary approval on February 5, 2026, held a fairness hearing on June 1, 2026, and Judge Max O. Cogburn Jr. entered the final approval order on June 9, 2026.⁵¹

Who Qualifies

The class includes all persons and entities who bought Driven Brands common stock (ticker DRVN) between October 27, 2021 and August 1, 2023. Excluded: the named defendants, their immediate family, company officers and directors, Driven Brands’ affiliates and subsidiaries, and Roark Capital Management and its affiliates.⁴

How to File

Eligible investors need to submit a Proof of Claim and Release Form by July 6, 2026. You can file online at DrivenBrandsSecuritiesLitigation.com or mail the form to the claims administrator, Strategic Claims Services, P.O. Box 230, 600 N. Jackson St., Suite 205, Media, PA 19063. Be ready to document your trades with brokerage statements or confirmation slips.²

Attorneys’ fees of $6.75 million come out of the fund. Projected recoveries have been estimated at roughly $0.85 per damaged share if every eligible investor files, or about $3.40 per share at a more typical 25% participation rate.⁶

What the Case Was About

The complaint centered on two acquired business lines: Auto Glass Now and the company’s car wash segment.

Driven Brands paid about $170 million for Auto Glass Now in late December 2021, adding more than 75 locations, and executives publicly described the integration as proceeding “according to plan,” calling acquisition integration a “core strength.”⁷⁸ According to the complaint, the point-of-sale system supporting the platform was incomplete and non-functional and required a rebuild from scratch, many acquired locations could not communicate with the platform, and the company was still roughly a year from being able to service insurers as of October 2022.⁹

Plaintiffs said the car wash segment was similarly misrepresented. They alleged weaker customer traffic, more competition, slower retention in newer markets, and underinvestment in service, equipment, and maintenance that led to significant impairments.⁶⁹ For fiscal 2023, the company recognized $851 million in goodwill impairment plus $132.9 million in additional asset impairment charges and lease terminations tied to the car wash segment.¹⁰

The disclosure that ended the class period came on August 2, 2023, when Driven Brands cut full-year guidance and said the auto glass integration was “several quarters behind” and “not going as quickly as planned.” The company reduced its 2023 earnings-per-share guidance by 24% after reaffirming it just two months earlier and cut its target for new glass store openings from 130 to roughly 90. The stock dropped $10.63 per share that day, about 41%.⁹⁶

The Second Lawsuit: 2026 Accounting Restatement

If you bought Driven Brands stock after August 1, 2023, the settlement above doesn’t cover you. A separate, newer case does.

On February 25, 2026, Driven Brands disclosed that its Audit Committee had concluded its financial statements for fiscal 2023, fiscal 2024, and several 2025 quarterly periods contained material errors and “should not be relied upon.” PricewaterhouseCoopers, the auditor, advised that the prior statements and related internal controls opinions could no longer be relied upon.¹¹¹²

The errors spanned lease accounting, cash reconciliations that inflated cash balances and revenue while understating SG&A, expense misclassification, revenue recognition in the ATI business (primarily in fiscal 2025), income tax provisions, fixed assets, and cloud computing entries.¹³¹¹¹² The stock opened at $9.99 that day after closing at $16.61 the day before, roughly a 40% drop.¹⁴

The active case is City of Hollywood Police Officers’ Retirement System v. Driven Brands Holdings Inc. (Case No. 3:26-cv-00283), filed April 8, 2026 in the Western District of North Carolina. It covers a proposed class period from May 3, 2023 through February 24, 2026 and names CFO Michael Diamond and former CFO Gary Ferrara among the defendants.¹⁵¹⁶ An earlier case, Clark v. Driven Brands Holdings Inc. in the Southern District of New York, was voluntarily dismissed without prejudice on April 21, 2026 before a lead plaintiff was appointed.¹⁷ As of mid-2026 the City of Hollywood case remains in its early stages, with no settlement, no class certification, and no claim form to file yet.

Where the Company Stands Now

Driven Brands missed the filing deadline for its 2025 annual report and does not expect to file its first-quarter 2026 report on time. Nasdaq sent deficiency notices on April 15, 2026 and again on June 1, 2026 for noncompliance with listing rules requiring timely SEC filings. Neither notice has an immediate effect on the stock’s listing, and the company has said it expects to file the overdue annual report by the June 15, 2026 compliance deadline. Nasdaq can grant up to 180 calendar days from the original due date to regain compliance.¹⁸¹⁹

The company has reported approximately $130 million in cash and total net debt of about $1.6 billion, and it said adjusted earnings were affected by expenses tied to the restatement process.²⁰ CEO Jonathan Fitzpatrick, one of the defendants in the settled case, stepped down effective May 9, 2025 and moved to non-executive chairman. Chief Operating Officer Daniel Rivera succeeded him as president and CEO.²¹

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Driven Brands Securities Litigation. File a Claim Online
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Driven Brands Investor Relations. Driven Brands Receives Expected Notification of Deficiency From Nasdaq
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Driven Brands Investor Relations. Driven Brands Provides Preliminary Unaudited Results and Update on SEC Filing Status
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Driven Brands Investor Relations. Driven Brands Announces CEO Transition