Kahn Swick & Foti, LLC said Oct. 16 it had opened an investigation into Navan, Inc.’s IPO disclosures amid allegations that offering documents omitted a 39% rise in sales and marketing expenses.
The firm is examining potential breaches of shareholder duties and other state or federal law violations by Navan officers and directors. Its inquiry follows a proposed securities class action over the company’s Oct. 31, 2025, initial public offering.
The original complaint, filed Feb. 23, 2026, alleges that Navan’s IPO documents did not disclose an increase in sales and marketing expenses from $68.5 million for the quarter ended July 31, 2025, to about $95 million for the quarter ended Oct. 31, a rise of 39%. Navan’s filings report the totals as $68.496 million and $94.949 million, respectively. The expense figures cover the full quarters; the filings do not show how much accrued before or after the IPO date or establish what directors knew then.
Navan’s Sept. 10 filing says plaintiffs submitted an amended complaint on Aug. 5. The 39% expense allegation cited here appears in the original complaint. Navan’s October 2025 quarterly filing separately reports that sales and marketing expenses rose 63% from the same quarter a year earlier, from $58.086 million to $94.949 million. The company attributed most of that annual increase to higher salaries and benefits, including $23.9 million in IPO-related stock-based compensation, and increased headcount.
Navan’s final IPO prospectus said the company expected to keep increasing its sales and marketing investment, with the expenses rising in dollar terms. The 39% complaint allegation compares consecutive quarters, while the 63% figure in Navan’s filing compares the October quarter with the same period a year earlier.
A separate shareholder derivative complaint filed Sept. 8, 2026, alleges fiduciary breaches that mirror the class-action claims. Navan said it intends to defend both cases and could not reasonably estimate a possible loss as of July 31, 2026.
The court’s June 30 scheduling order sets Nov. 13, 2026, for responses and Dec. 18 for replies on defendants’ anticipated motions to dismiss. It does not set a date for a ruling.
