The Law Offices of Frank R. Cruz Announces the Filing of a Securities Class Action on Behalf of Gaotu Techedu Inc. f/k/a GSX Techedu Inc. (GOTU) Investors
LOS ANGELES--(BUSINESS WIRE)--Jan 10, 2023--
The Law Offices of Frank R. Cruz announces that a class action lawsuit has been filed on behalf of persons and entities that purchased or otherwise acquired Gaotu Techedu Inc. f/k/a GSX Techedu Inc. (“Gaotu” or the “Company”) (NYSE: GOTU ) American depository shares (“ADSs”) between March 5, 2021 and July 23, 2021, inclusive (the “Class Period”). Gaotu investors have until February 28, 2023 to file a lead plaintiff motion.
If you are a shareholder who suffered a loss, click here to participate.
On July 23, 2021, Reuters reported that China was barring for-profit tutoring programs, citing a government document that was widely circulated. The regulatory move “threatens to decimate the $120 billion private tutoring industry.”
On this news, Gaotu’s ADS price fell 63.3%, to close at $3.25 per ADS on July 23, 2021, thereby injuring investors.
Then, on November 6, 2021, the Financial Times published an article alleging, among other things, that Gaotu leaders had been aware that Beijing was considering stricter regulations on the tutoring industry. The article also reported that a shell company holding shares for Gaotu’s executives sold $119 million worth of shares days after the Chinese president remarked that home-schooling was a “stubborn disease” that was putting too much pressure on Chinese children and their parents.
The complaint filed in this class action alleges that throughout the Class Period, 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 failed to disclose to investors that: (1) China was barring tutoring for profit in core school subjects and the policy change would restrict foreign investment in a sector that had become essential to success in Chinese school exams; (2) the impact such regulations would have on Gaotu’s operations and profitability and the value of Company securities; and (3) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
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If you purchased Gaotu securities during the Class Period, you may move the Court no later than February 28, 2023 to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you purchased Gaotu securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Frank R. Cruz, of The Law Offices of Frank R. Cruz, 1999 Avenue of the Stars, Suite 1100, Los Angeles, California 90067 at 310-914-5007, by email to firstname.lastname@example.org, or visit our website at www.frankcruzlaw.com. If you inquire by email please include your mailing address, telephone number, and number of shares purchased.
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/20230110005052/en/
CONTACT: The Law Offices of Frank R. Cruz, Los Angeles
Frank R. Cruz, 310-914-5007
KEYWORD: CALIFORNIA UNITED STATES NORTH AMERICA
INDUSTRY KEYWORD: CLASS ACTION LAWSUIT PROFESSIONAL SERVICES LEGAL
SOURCE: Law Offices of Frank R. Cruz
Copyright Business Wire 2023.
PUB: 01/10/2023 12:30 PM/DISC: 01/10/2023 12:31 PM