Tencent Music Entertainment Group Class Action Lawsuit

10 days left to seek lead plaintiff status

Case Summary

Company Name
Tencent Music Entertainment Group
Stock Symbol
Class Period
December 12, 2018 to August 26, 2019
Motion Deadline
November 25, 2019
Eastern District of New York

On September 26, 2019, the Tencent Music Entertainment Group class action lawsuit was filed charging Tencent Music and certain of its officers with violations of the Securities Exchange Act of 1934. The Tencent Music class action lawsuit was commenced in the Eastern District of New York on behalf of purchasers of Tencent Music publicly traded securities between December 12, 2018 and August 26, 2019 (the “Class Period”) and is captioned Gordon v. Tencent Music Entertainment Group, No. 1:19-cv-05465.

Tencent Music operates online music entertainment platforms that provide music streaming, online karaoke, and live streaming services in the People’s Republic of China.  Tencent Music went public on December 12, 2018 in an initial public offering (“IPO”) of more than 41 million American Depositary Shares (“ADSs”), which were sold to the public at $13 per ADS.

The Tencent Music class action lawsuit alleges that throughout the Class Period and in the Prospectus for the IPO, defendants made false and misleading statements and/or failed to disclose adverse information regarding Tencent Music’s business and prospects.  Specifically, defendants failed to disclose that Tencent Music’s exclusive licensing arrangements with major record labels were anticompetitive, which caused sublicensing such content from Tencent Music unreasonably expensive and violated Chinese antimonopoly laws.  As a consequence, Tencent Music was reasonably likely to be the subject of increased regulatory scrutiny.  As a result of this adverse information being withheld from the market, the price of Tencent Music ADSs was artificially inflated to as high as $19 per ADS during the Class Period.

Then on August 27, 2019, Bloomberg reported that China’s antitrust authority, the State Administration of Market Regulation (“SAMR”), was investigating the exclusive licensing deals between Tencent Music and major record labels, including Universal Music Group, Sony Music Entertainment, and Warner Music Group.  According to Bloomberg, SAMR was scrutinizing Tencent Music’s dealings with the three large record labels, which “have all sold exclusive rights to a major chunk of their music catalogs to Tencent Music, which is controlled by social media titan Tencent Holdings Ltd. but also backed by Sony and Warner.  Tencent Music then sublicenses that content to smaller rivals, an arrangement they complain is unfair.  Tencent Music pays fees that are unreasonably high and passes along much of those costs to its competitors . . . .  Licensing songs from Tencent Music for use in China can be twice as expensive compared to . . . licensing directly from major labels for the rest of the world.”  On this news, the price of Tencent Music ADSs fell nearly 7% to close at $12.57 per ADS on August 27, 2019.

The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Tencent Music publicly traded securities during the Class Period to seek appointment as lead plaintiff in the Tencent Music class action lawsuit.  A lead plaintiff will act on behalf of all other class members in directing the Tencent Music class action lawsuit.  The lead plaintiff can select a law firm of its choice to litigate the Tencent Music class action lawsuit.  An investor’s ability to share in any potential future recovery of the Tencent Music class action lawsuit is not dependent upon serving as lead plaintiff.  If you wish to serve as lead plaintiff of the Tencent Music class action lawsuit or have questions concerning your rights regarding the Tencent Music class action lawsuit, please provide your information here or contact counsel, Brian E. Cochran of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at bcochran@rgrdlaw.com.  Lead plaintiff motions for the Tencent Music class action lawsuit must be filed with the court no later than November 25, 2019.

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.

Class Period: December 12, 2018 - August 26, 2019
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