A class action lawsuit was filed against Dow Inc. (DOW) on August 29, 2025. The plaintiffs (shareholders) alleged that they bought DOW stock at artificially inflated prices between January 30, 2025, and July 23, 2025 (Class Period) and are now seeking compensation for their financial losses. Investors who bought Dow stock during that period can click here to learn about joining the lawsuit.
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Dow is a leading global materials science company that leverages chemistry, biology, and physics expertise to provide innovative products and solutions for high-growth markets including packaging, infrastructure, mobility, and consumer applications.
The company’s claims about mitigating certain macroeconomic risks and impact from U.S. reciprocal tariffs are at the heart of the current complaint.
Dow’s Misleading Claims
According to the lawsuit, Dow and three of its senior officers (the Defendants) repeatedly made false and misleading public statements throughout the Class Period. In particular, they are accused of omitting truthful information about the effect of certain macroeconomic challenges on the company’s business, and its ability to maintain the financial flexibility needed to support its lucrative dividend, from SEC filings and related material.
In a press release at the beginning of the Class Period, the CEO expressed confidence that the company would benefit from completing near-term growth projects and maintaining operational discipline in 2025. Dow also expected increased demand in key end markets like packaging, energy, and electronics.
Additionally, in its fiscal 2024 annual report Dow stated that it expects to grow volumes and improve profit margins by adding new polyethylene capacity and improving reliability, particularly in Packaging & Specialty Plastics.
Finally, in a press release dated April 24, 2025, the CEO stated that despite ongoing economic challenges, the company achieved six straight quarters of growth in volume (year-over-year) while focusing on cost reduction and capacity adjustments to strengthen financial flexibility and support balanced capital allocation.
However, subsequent events (detailed below) revealed that the defendants had failed to inform investors that the company had failed to maintain the financial flexibility needed to support its lucrative dividend.
Plaintiffs’ Arguments
The plaintiffs maintain that the defendants deceived investors by lying and withholding critical information about the company’s business practices and prospects during the Class Period. Importantly, the defendants failed to inform investors about the true extent and seriousness of the negative impacts from economic and market challenges on Dow’s business and financial condition.
The information became clear on July 24, 2025, roughly a month after BMO Capital downgraded its recommendation on Dow’s performance and lowered the price target on its stock.
In the press release, Dow’s CEO attributed the company’s disappointing second-quarter financial results, including a loss of $801 million, to the industry’s prolonged low earnings environment and uncertainties from recent trade and tariff issues.
Dow announced in a separate press release the same day that it was cutting its quarterly dividend from $0.70 to $0.35 per share to enhance financial flexibility amid ongoing challenges in the economy. The CEO stated this move was necessary due to a persistently difficult macroeconomic environment affecting the industry. Following the news, DOW stock plunged 16.3%.
To conclude, the defendants failed to inform investors about the true extent of negative impacts on Dow’s business and finances, especially from competition, pricing pressure, weaker global sales and demand, and excess product supply in global markets. Due to these issues, DOW stock has lost nearly 33% year-to-date.
