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Attorneys representing investors in a securities dispute involving Malibu Boats Inc. have been awarded $2.34 million in legal fees, along with reimbursement of more than $115,600 in litigation expenses, following approval of a settlement tied to claims that the company overstated its financial resilience after the pandemic-driven boating demand surge.

The award was issued in a Tuesday order by U.S. District Judge Lorna G. Schofield of the United States District Court for the Southern District of New York. The judge approved the legal team’s request to receive 30% of the $7.8 million settlement fund, ruling that the compensation was fair and consistent with fee structures seen in comparable class action resolutions.

The court described the requested amount as reasonable, noting that the reimbursement claim represented less than 1.5% of the overall settlement value. Judge Schofield also granted a separate $1,500 reimbursement to the lead plaintiff, the Retiree Benefit Trust of the City of Baltimore, covering participation-related costs.

The settlement stems from allegations that company representatives suggested the boating manufacturer was financially insulated from post-pandemic market fluctuations. Investors argued that internal business practices instead revealed vulnerability to broader economic pressures affecting consumer purchasing patterns.

According to the complaint, the company was accused of distributing excessive inventory through its dealer network after the pandemic-era recreational boat buying boom slowed. Plaintiffs alleged this strategy created financial strain on distributors and risked pushing at least one major dealer toward insolvency.

Investor filings claimed company management promoted optimistic business outlooks despite deteriorating macroeconomic conditions. The class action further alleged that hundreds of millions of dollars in surplus inventory were pushed into distribution channels in what plaintiffs described as a market-inflation scheme.

The settlement agreement was finalized earlier in February after the court determined that the resolution was fair, reasonable, and adequate for affected shareholders. The plaintiffs’ legal counsel argued that the recovery level was meaningful given the company’s limited cash flexibility and the declining value of directors’ and officers’ liability insurance coverage available to the defendants.

The investors estimated potential recoverable damages could have been significantly higher but would have been difficult to achieve through continued litigation. Settlement proceeds are expected to be distributed among class members after administrative processing.

The plaintiffs were represented by attorneys from Saxena White PA, including Lester R. Hooker, Steven B. Singer, Joshua H. Saltzman, and Sara DiLeo.

The defendants were represented by lawyers from Cooley LLP.

The case is captioned Retiree Benefit Trust of the City of Baltimore v. Malibu Boats Inc. et al., filed under case number 1:24-cv-03254 in the Southern District of New York.