Hidden Inventory and Finance Risks Trigger Securities Fraud Suits Against CarMax and James Hardie

2025-12-17 companies

New York, Wednesday, 17 December 2025.
Hagens Berman has initiated class-action lawsuits against CarMax and James Hardie, alleging both firms concealed critical operational risks—specifically regarding auto finance instability and inventory loading—that precipitated stock crashes of up to 44%. Investors face imminent deadlines to petition as lead plaintiffs.

CarMax: The cost of concealed credit risks

The legal action against CarMax, Inc. (KMX) centers on allegations that the company masked the deteriorating health of its auto finance portfolio while artificially inflating sales figures through a temporary tariff event [1]. The lawsuit, covering the class period between June 20, 2025, and November 5, 2025, claims that executives assured investors of growth even as the foundation of the business began to fracture [1]. The financial reality surfaced on September 25, 2025, when CarMax reported a 24% decline in net earnings per share, accompanied by a loan loss provision of $142 million—a sequential increase of 40% [1]. This revelation triggered an immediate 20% decline in the company’s stock price, as the market adjusted to the undisclosed credit risks [1].

James Hardie: Inventory loading vs. actual demand

Parallel to the auto sector turmoil, James Hardie Industries plc (JHX) is facing scrutiny over its inventory management practices in the North America Fiber Cement segment. The complaint alleges that between May 20, 2025, and August 18, 2025, company executives misled investors by describing demand as “robust” and “normal,” despite knowing by April or early May that distributors were actively destocking inventory [2][5]. The lawsuit claims that sales figures were inflated by inventory loading—pushing product into the channel ahead of actual demand—rather than reflecting organic market consumption [2].

Critical timelines for investor recourse

For investors who incurred losses due to these alleged disclosure failures, the window to participate as a lead plaintiff is narrowing rapidly. The deadline for the James Hardie class action is imminent, set for December 23, 2025—just six days from today [2][5]. CarMax investors have a slightly longer window, with a deadline of January 2, 2026, to petition the court [1]. These legal actions follow a broader trend of scrutiny regarding corporate governance and financial reporting; for instance, MoonLake Immunotherapeutics (MLTX) recently saw its lead plaintiff deadline pass on December 15, 2025, following a 90% stock collapse linked to disappointing clinical trial results [4][6].

Sources

Corporate Governance Securities Litigation