On August 26, 2026, Saxena White secured a significant victory when the Honorable Max O. Cogburn Jr. of the Western District of North Carolina, in Cameron, et al. v. Ashukian, et al., No. 3:25-cv-332-MOC (W.D.N.C.), granted in part and denied in part Defendants’ motion to dismiss Lead Plaintiffs’ amended complaint, allowing fourteen of Plaintiffs’ thirty-five challenged statements to proceed to discovery.
The case arises out of the collapse of Krispy Kreme’s high-profile nationwide partnership with McDonald’s. Krispy Kreme, which produces and sells doughnuts through its own stores and partner retailers, began a test partnership with McDonald’s in Louisville, Kentucky in October 2022. Following an expanded pilot, the companies announced a nationwide rollout in March 2024, and Krispy Kreme’s stock price rose in response. The partnership was paused in May 2025 and terminated entirely by June 2025.
Plaintiffs allege that from May 9, 2024 through May 7, 2025 Defendants Krispy Kreme, its CEO Josh Charlesworth, and its former CFO Jeremiah Ashukian repeatedly told investors that the McDonald’s rollout was succeeding and could be executed using the company’s existing production and distribution capacity, all while concealing operational problems that made the partnership untenable. Those allegations were supported by statements from eleven confidential witnesses, ranging from a former Krispy Kreme executive to store-level managers, describing production facilities in disrepair, chronic understaffing of delivery drivers, and costly, undisclosed infrastructure overhauls required to meet McDonald’s standards.
The Court found that fourteen of the alleged misstatements made between mid-2024 and February 2025 were actionably false. The Court held that Defendants’ repeated assurances that the rollout would be supported by “existing capacity” and would not require significant new capital expenditures were “mixed present/future statements” not entitled to safe-harbor protection, and that confidential-witness accounts of dilapidated production facilities and an overwhelmed delivery network were sufficient to plead falsity. The Court likewise sustained Defendants’ February 2025 statements touting the rollout’s success and reaffirming a goal of 6,000 McDonald’s locations by year-end, finding that by that point Defendants had nearly five months of internal performance data and lacked meaningful cautionary language to invoke the safe harbor.
The Court also found that Plaintiffs adequately alleged scienter as to both individual defendants. Although Plaintiffs did not allege a classic insider-trading motive, the Court held that allegations Defendants rushed into an inadequately vetted deal to reverse a business downturn, and later terminated the executives responsible once the partnership collapsed, supported an inference of fraudulent intent. The Court further pointed to confidential-witness testimony that an internal cost analysis was presented to the Board before the rollout began, that capital expenditures required executive-level approval, and that Defendant Charlesworth had real-time access to sales data reflecting the partnership’s performance.
The case will now proceed to the discovery phase.
