Hagens Berman Announces an Investigation of Diageo plc Relating to Potential Accounting Irregularities

SAN FRANCISCO--(BUSINESS WIRE)--

Hagens Berman Sobol Shapiro LLP is investigating Diageo plc DEO ("Diageo" or "the Company") and its Board for possible violations of federal securities laws. If you have losses in Diageo securities, or knowledge relevant to the investigation, contact Hagens Berman Partner Reed Kathrein, who is leading the firm's investigation, by calling (510) 725-3000, emailing DEO@hbsslaw.com or visiting http://hb-securities.com/investigations/DEO.

The investigation is based upon Diageo's statement that the SEC is investigating whether Diageo has been shipping excess inventory in an effort to inflate earnings results. In March of 2015, Australian equity manager Cooper Investors Pty Limited ("Cooper") warned investors that it suspected Diageo of accounting irregularities. Cooper divested its position in Diageo after channel checks with distributors revealed evidence of channel stuffing. Channel stuffing occurs when retailers push as much inventory as possible to their wholesalers, even if markets have insufficient demand to justify the action, and even if wholesalers return the merchandise after reporting quarterly results. Cooper was concerned over what it believed was a lack of transparency in Diageo's distribution strategy, and what actions were being taken to remedy issues in high risk markets. Cooper revealed a source that told the firm it had never seen Diageo as desperate to hit its numbers, possibly attempting to keep promises it made to investors after a series of disappointing quarters – the Company's U.S. market share declined each year between 2011 and 2014.

Diageo reports full-year results next week.

Whistleblowers: Persons with non-public information regarding Diageo should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the SEC whistleblower program, whistleblowers who provide original information may receive rewards up to 30 percent of any successful recovery made by the SEC. For more information concerning your whistleblower options, call Reed Kathrein at (510) 725-3000 or email DEO@hbsslaw.com.

About Hagens Berman

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