Luckin Coffee is using Joele Frank to handle crisis PR following the release of an anonymous report alleging fraud at the Starbucks of China, which resulted in a 19 percent plunge in its stock price on Jan. 31.
Shares were already under pressure, losing about a third of their value following the outbreak of the coronavirus. Luckin has closed its shops in Wuhan, Ground Zero of the epidemic.
The coffee chain with about 4,500 outlets in China filed a Form 6 today with the Securities and Exchange Commission that categorically denied all allegations of fraud.
“The methodology of the Report is flawed, the evidence is unsubstantiated and the allegations and unsupported speculations are malicious interpretations of events,” it said.
The Beijing-based company intends “to take appropriate actions to defend itself against these malicious allegations and to protect the interests of all its shareholders,” according to the document.
Luckin shares trade on the NASDAQ at $35.05. They ranged from $51.38 to $13.72 over the past 52 weeks.
Joele Frank, Wilkinson Brimer Katcher’s Ed Trissel and Jack Kelleher handle media for Luckin.