Kaplan Fox Has Filed a Class Action to Recover Losses for Investors of Didi Global Inc. (f/k/a Xiaoju Kuaizhi Inc.) Securities (NYSE: DIDI)

Tuesday, 13. July 2021 03:23

NEW YORK, July 12, 2021 (GLOBE NEWSWIRE) -- Kaplan Fox & Kilsheimer LLP (www.kaplanfox.com) has filed a class action suit in the United States District Court for the Southern District of New York against DiDi Global Inc. (“DiDi” or the “Company”) (NYSE: DIDI), Chairman of the Board and CEO Will Wei Cheng, CFO Alan Yue Zhuo, the underwriters of the Company’s June 2021 initial public offering (“IPO”), and certain Company Directors that signed or authorized the signing of the Registration offering documents for the IPO.

The Complaint alleges that Defendants violated Sections 11 and 15 of the Securities Act of 1933 (15 U.S.C. §§ 77k and 77o), and Sections 10(b) and 20(a) of the Exchange Act of 1934 (15 U.S.C. §§ 78j(b) and 78t(a)) and Rule 10b-5 promulgated thereunder by the SEC (17 C.F.R. § 240.10b-5) on behalf of persons and entities that purchased or otherwise acquired DiDi: (a) American Depositary Shares (“ADSs” or “shares”) pursuant and/or traceable to the registration statement and prospectus (collectively, the “Registration Statement”) issued in connection with the Company’s June 2021 initial public IPO and/or (b) purchased DiDi securities between June 30, 2021 and July 2, 2021, inclusive (the “Class Period”).

If you are a member of the proposed Class, you may move the court no later than September 7, 2021 to serve as a lead plaintiff for the proposed Class. You need not seek to become a lead plaintiff in order to share in any possible recovery. 

The Complaint alleges that DiDi purports to be the world’s largest mobility technology platform. Its four key components are: shared mobility, auto solutions, electronic mobility, and autonomous driving. The Company claims to be the “go-to brand in China for shared mobility,” offering a range of services including ride hailing, taxi hailing, chauffeur, hitch, and other forms of shared mobility services.

The Complaint also alleges that in the IPO and pursuant to the Registration Statement, including the Prospectus filed on June 30, 2021, the Company sold approximately 316,800,000 shares at a price of $14.00 per share, not including the underwriters’ option to sell an additional 47,520,000 ADSs.

The Complaint also alleges that the Registration Statement was materially false and misleading and omitted to state material adverse facts and that throughout the Class Period, including in the Registration Statement, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants are alleged to have failed to disclose to investors: (1) that the Cyberspace Administration of China (“CAC”) had already asked DiDi weeks or months prior to the IPO to delay its IPO to conduct a self-examination of its network security and because of national security concerns; (2) that the Company was likely to incur heightened regulatory scrutiny and adverse regulatory action by ignoring the CAC’s request to postpone the IPO; (3) that, as a result of the foregoing, DiDi’s apps were reasonably likely to be taken down from app stores in China, which would have an adverse effect on its financial results and operations; and (4) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.

According to the Complaint, the truth began to emerge on July 2, 2021 when DiDi issued a press release entitled “DiDi announces CyberSecurity Review in China,” confirming that the Company was under investigation and stating that “pursuant to the announcement posted by the PRC’s Cyberspace Administration Office on July 2, 2021, DiDi is subject to cybersecurity review by the authority.” The Company’s press release also allegedly states “[d]uring the review, DiDi is required to suspend new user registration in China.” On this news, the Company’s share price fell $0.87 per share, or approximately 5.3%, to close at $15.53 per share on July 2, 2021, on unusually heavy trading volume.

Further, on Sunday, July 4, 2021, DiDi issued a press release entitled “DiDi Announces App Takedown in China[,]” which announced, in relevant, part that the CAC ordered smartphone app stores to stop offering the “DiDi Chuxing” app because the DiDi app “collect[ed] personal information in violation of relevant PRC laws and regulations.” Though users who previously downloaded the DiDi app could continue to use it, DiDi stated that “the app takedown may have an adverse impact on its revenue in China.” On this news, the Company’s share price fell $3.04 per share, or 19.6%, to close at $12.49 per share on July 6, 2021, on unusually heavy trading volume.

On July 12, 2021, DiDi shares closed at $11.16 per share, a decline of over 20% from the $14 per share IPO price.

Plaintiff seeks to recover damages on behalf of the proposed Class and is represented by Kaplan Fox & Kilsheimer LLP (www.kaplanfox.com). Our firm, with offices in New York, Oakland, Los Angeles, Chicago, and New Jersey, has decades of experience in prosecuting investor class actions and actions involving violations of the Federal securities laws. 

If you have any questions about this Notice, the action, your rights, or your interests, or would like a copy of the complaint, please e-mail or call attorneys Jeffrey Campisi (jcampisi@kaplanfox.com; (212) 329-8571) or Pamela Mayer (pmayer@kaplanfox.com; (646) 315-9003) or contact the attorneys below:

Jeffrey P. Campisi
850 Third Avenue, 14th Floor
New York, New York 10022
(212) 329-8571
E-mail: Jcampisi@kaplanfox.com

Laurence D. King
1999 Harrison Street, Suite 1560
Oakland, CA 94612
Telephone: (415) 772-4700
E-mail: lking@kaplanfox.com

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