Baozun Inc. Class Action Lawsuit
- Company Name
- Baozun Inc.
- Stock Symbol
- Class Period
- March 6, 2019 to November 20 2019
- Motion Deadline
- February 8, 2020
- Southern District of New York
On December 10, 2019, Robbins Geller Rudman and Dowd LLP filed the Baozun Inc. class action lawsuit alleging violations of the Securities Exchange Act of 1934 by Baozun and certain of its officers. The Baozun class action lawsuit was commenced in the Southern District of New York on behalf of purchasers of Baozun American Depositary Receipts (“ADRs”) between March 6, 2019 and November 20, 2019 (the “Class Period”) and is captioned Snyder v. Baozun Inc., et al., No. 19-cv-11290.
Baozun provides e-commerce services to brand partners in the People’s Republic of China. Baozun offers end-to-end e-commerce services, including IT infrastructure setup and integration, sale of apparel, home and electronic products, online store design and setup, visual merchandising and marketing, online store operations, customer services, warehousing, and order fulfillment, that helps companies sell their branded goods online.
The Baozun class action lawsuit alleges that during the Class Period, defendants made false and misleading statements and/or failed to disclose adverse information regarding Baozun’s business and financial results. Specifically, defendants failed to disclose that Huawei Technologies Co., Ltd. (“Huawei”), a Chinese-based multi-national technology company, was one of Baozun’s largest brand partners, on a historical basis, and paid more add-on fees for the work Baozun did for it, increasing the revenues Baozun received for Huawei work compared to Baozun’s other brand partners. This caused Baozun to report outsized revenue growth during the first half of 2019, which would be abruptly cut off during the second half 2019, after Baozun restructured its relationship with Huawei, as Huawei took much of its online merchandizing in-house. As a result of this information being withheld from the market, the price of Baozun ADRs was artificially inflated throughout the Class Period, allowing Baozun to sell at least 2.25 million ADRs in a registered public stock offering at $40 per ADR on or about April 10, 2019, raising $90 million, and close a concurrent offering of $225 million in aggregate principal amount of convertible senior notes due 2024 the same day, receiving net proceeds of approximately $269 million.
Then on November 21, 2019, Baozun announced third quarter 2019 financial results that were lower than the market had been led to expect and provided dismal fourth quarter 2019 financial guidance, blaming, in large part, the adverse “impact from terminating our service agreement with one electronics brand.” Though Baozun did not disclose who that large “electronics brand” was, many in the financial media have suggested that it was Huawei. On this news, the price of Baozun ADRs fell $7.60 per ADR, or more than 17%, to close at $35.90 per ADR on November 21, 2019.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Baozun ADRs during the Class Period to seek appointment as lead plaintiff in the Baozun class action lawsuit. A lead plaintiff will act on behalf of all other class members in directing the Baozun class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Baozun class action lawsuit. An investor’s ability to share in any potential future recovery of the Baozun class action lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff of the Baozun class action lawsuit or have questions concerning your rights regarding the Baozun class action lawsuit, please provide your information here or contact counsel, Mary K. Blasy of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at email@example.com. Lead plaintiff motions for the Baozun class action lawsuit must be filed with the court no later than February 8, 2020.
Robbins Geller Rudman & Dowd LLP is one of the world’s leading law firms representing investors in securities class action litigation. With 200 lawyers in 9 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For six consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in the world in both amount recovered for shareholders and total number of class action settlements. Robbins Geller attorneys have helped shape the securities laws and have recovered tens of billions of dollars on behalf of aggrieved victims. Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide. Robbins Geller attorneys are consistently recognized by courts, professional organizations and the media as leading lawyers in the industry.