ATLANTA (From news reports) -- A shareholder filed a class action lawsuit against Graphic Packaging International on May 7 alleging the company and certain C-suite executives violated federal securities laws by misleading investors. The suit was filed in the U.S. District Court for the Southern District of New York.

Former GPI CEO Mike Doss and former CFO Stephen Scherger also are named as individual defendants in the lawsuit due to claims they made misleading statements or failed to disclose information about the company's financial health and operations.

The suit seeks damage payments for shareholders, along with payment of attorneys' fees and other costs. Graphic Packaging International said it does not comment on pending litigation.
This lawsuit aims to involve investors who acquired GPI shares between Feb. 4, 2025, and Feb. 2, 2026. It claims the defendants released information during that timeframe indicating the company's operations and results were "strong and steady" despite market headwinds. But the company's stock price proceeded to drop precipitously, the lawsuit says, causing financial harm to shareholders who used the information to make investment decisions.

The plaintiff "acquired Graphic Packaging securities at artificially inflated prices during the Class Period and was damaged upon the revelation of the alleged corrective disclosures," the filing says.

The suit claims the company had inventory management issues, lower demand and higher costs, and that the defendants "downplayed the true scope and severity of the foregoing issues." Therefore, it says GPI's "previously issued FY 2025 financial guidance was unreliable and/or unrealistic," resulting in public statements of business strength that were "materially false and misleading."

The lawsuit lays out a series of related public disclosures or omissions, saying the "truth began to emerge on May 1, 2025," when GPI released its first-quarter 2025 earnings results. The company reported declines in non-GAAP earnings per share and in revenue, prompting it to revise down its previous full-year guidance.

Doss and Scherger are named in the lawsuit, in part, because they "possessed the power and authority to control the contents of Graphic Packaging's SEC filings, press releases, and other market communications." They had the ability to correct these public communications or prevent them from being released, according to the filing.

"[T]he Individual Defendants knew that the adverse facts specified herein had not been disclosed to and were being concealed from the public, and that the positive representations being made were then materially false and misleading. The Individual Defendants are liable for the false statements and omissions pleaded herein," it says.

In October 2025, Amcor announced that it was hiring Scherger away from GPI to become its new CFO. In December, GPI announced that it would undertake a series of changes in the coming months, which included ending Doss' 10-year run as CEO and replacing him with Robbert Rietbroek.

Days later, private investment firm Eminence Capital campaigned for GPI's board to reinstate Doss. In a letter to the board, Eminence said that Doss "is a high-integrity executive held in high regard by customers, shareholders, and competitors alike; and he is beloved internally."

In a subsequent securities filing, GPI defended its decision to let go of Doss. It noted the company's "recent performance has not met expectations, as reflected by the nearly 50% decline in our share price over the past year." Although industry shifts and macroeconomic trends played a role, the stock decline "was a clear signal that meaningful change was required," meaning a leadership change, according to the filing.

The same day the company announced the CEO switch, it also issued a news release announcing it would cut costs by $60 million in 2026, including via layoffs. GPI also disclosed it would begin certain inventory reduction efforts in Q4 2025 that were initially planned for 2026. "Production curtailment is expected to impact fourth quarter operating results by $15 million, which is in addition to the $15 million relating to curtailments announced during the third quarter earnings call," it said.

After those Dec. 8 announcements, the company's stock fell $1.35 per share, or 8.66%, on Dec. 9, according to the lawsuit. The filing cites an even more pronounced one-day stock dip, 15.97%, on Feb. 3, 2026, the day GPI announced its Q4 and full-year 2025 earnings. During the earnings call that day, Rietbroek noted the company had launched a 90-day review of its organizational structure and business operations, with upcoming actions to drive performance and profitability.

In April, GPI quietly executed on a restructuring initiative and conducted employee layoffs. Rietbroek later confirmed during a May 5 earnings call that the company had recently cut more than 500 roles, or 3% of its global workforce.

While not mentioned in the documents for the federal case, GPI also recently issued a securities filing that describes financial discrepancies. Per analyst speculation, the issue appears to be related to Doss noting during a July 2025 earnings call that costs had climbed for the in-progress construction of a new recycled paperboard mill in Waco, Texas, which ultimately began production in October. Executives therefore bumped up capital expenditure projections for full-year 2025 from $700 million to $850 million. GPI disclosed the elevated capital spending in a securities filing this March.

The March securities filing said GPI did not "design and maintain effective controls for communicating and sharing certain information with the Board of Directors" related to capital expenditures, according to a note from its independent auditor, PricewaterhouseCoopers.

The filing says unnamed former members of senior management did not get the needed board approvals to cover the extra capital expenses. Although the filing didn't name the specific projects, analyst speculation has pointed to Waco. GPI has since taken measures to create and implement a stronger financial reporting plan, the auditor said in the March document.

The new lawsuit claims that during the yearlong period in question, Doss sold nearly 1.6 million shares of company stock, "enriching himself by over $7 million." During that same timeframe, Scherger sold 65,529 shares of company stock, "enriching himself by nearly $1.8 million," according to the filing.

The plaintiff has requested a jury trial, and other investors have until July 6 to join the case.