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The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Central District of California on behalf of those who acquired Dada Nexus Limited (“Dada” or the “Company”) DADA securities during the period from May 11, 2023 through January 8, 2024 (the “Class Period”). Investors have until March 11, 2024 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
On December 19, 2023, the Company issued a press release announcing Mr. Lijun Xin would be stepping down immediately as Dada’s Chairman of the Board due to personal reasons. In addition, Defendant Chen would be resigning as the Company’s Chief Financial Officer immediately due to personal reasons. Upon information and belief, Xin’s and Chen’s departure was the result of a January 8, 2024 restatement on Form 6-K, which stated, in relevant part, that an internal audit had identified “certain suspicious practices” that “may cast doubt on certain revenues from the Company’s online advertising and marketing services in 2023.” The Company estimated that “approximately RMB500 million of revenues from online advertising and marketing services and RMB500 million of operations and support costs may have been overstated, respectively, for the first three quarters of 2023.” Additionally, the Company advised that its previously stated revenue guidance for the fourth quarter and full year of 2023 should “no longer be relied upon.” On this news, the price of Dada shares declined by $1.45 per share, or approximately 46.03%, from $3.15 per share to close at $1.70 per share on January 8, 2024.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose that: (i) Dada revenues from online advertising, marketing services, and operations and support costs were materially overstated; (ii) as a result, Dada would need to conduct an independent review to ascertain the financial impact and the scope of suspicious practices that led to overstated revenues and costs; and (iii) as a result, Defendants’ statements about its business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.
If you purchased or otherwise acquired Dada securities, have information, or would like to learn more about this investigation, please contact Thomas W. Elrod of Kirby McInerney LLP by email at investigations@kmllp.com, or by filling out this contact form, to discuss your rights or interests with respect to these matters without any cost to you.
Kirby McInerney LLP is a New York-based plaintiffs’ law firm concentrating in securities, antitrust, whistleblower, and consumer litigation. The firm’s efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling billions of dollars. Additional information about the firm can be found at Kirby McInerney LLP’s website: https://www.kmllp.com.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240112831788/en/
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