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Alibaba State

Settlement of Chicago Laborers Pension Fund v. Alibaba Group Holding Limited, et al., Case No. CIV535692

The parties have reached a settlement of this action, pending in the Superior Court of the State of California for the County of San Mateo.  The Settlement provides for the payment of $75,000,000 for the benefit of eligible Class Members.  Plaintiffs Chicago Laborers Pension Fund, Gary Buelow, Rustem Nurlybayev, and Michael Hercules alleged that Alibaba Group Holding Limited’s (“Alibaba”) September 2014 IPO registration statement filed with the SEC failed to disclose known counterfeiting and other illicit activities being conducted on its e-commerce platforms and that such conduct could adversely impact the company’s growth and business prospects.  Plaintiffs also alleged that Alibaba failed to disclose that two months before the IPO, in July 2014, multiple Chinese regulators met with company executives and warned that such illegal practices, if not corrected, would result in fines and other regulatory action.

Plaintiffs further alleged that on January 28, 2015, China’s State Administration for Industry and Commerce released a “White Paper Regarding Administrative Guidance Provided to Alibaba Group” detailing the very illegal conduct reported directly to Alibaba executives before the IPO in July 2014 by Chinese regulators.  These January 2015 disclosures, reported by The Wall Street Journal and market analysts, triggered sharp declines in Alibaba’s stock price.  Later disclosures revealed the magnitude, scope and impact of the previously undisclosed facts resulting in even further stock price declines well below the $68.00 per share IPO price.

The Class consists of all persons and entities who purchased or otherwise acquired Alibaba American Depositary Shares (“ADS”) pursuant or traceable to the September 2014 Registration Statement and Prospectus filed in connection with Alibaba’s IPO on or about September 19, 2014.  For avoidance of doubt, and for purposes of this Settlement only, the “Class” includes all persons or entities who purchased or otherwise acquired Alibaba ADS on or before October 5, 2015.  Excluded from the Class are Defendants, the officers and directors of Alibaba (at all relevant times), members of their immediate families and their legal representatives, heirs, successors or assigns, and any entity in which any of the above has a majority ownership interest.  Also excluded from the Class are those Persons who would otherwise be Class Members but who timely and validly exclude themselves therefrom.  The Class is certified for settlement purposes only.

The Settlement was approved by the Court on May 17, 2019.

If you have any questions about the Settlement or the litigation, please contact Rick Nelson at 1-800-449-4900.

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