The ants afterwave is not over! Ali failed to fulfill the disclosure obligation in class action in the United States

category:Finance
 The ants afterwave is not over! Ali failed to fulfill the disclosure obligation in class action in the United States


After the suspension of listing, Ali was sued by American investors on the other side of the ocean.

Prior to that, due to the suspension of ant listing, Ali US shares had the biggest decline in more than five years, and the market value evaporated by 81.3 billion US dollars a day. Accordingly, many law firms are collecting claims clues from overseas investors, intending to accuse the company and its senior management of making significant false or misleading statements in the IPO process of ant group, thus causing heavy losses to shareholders.

In fact, this is not the first time that China and the United States have encountered overseas class action charges. Only in April this year, Ruixing encountered a class action in the United States due to fraud, or it will face 10 billion compensation, which caused public outcry; Ali also paid 250 million US dollars for class action in 2015.

For listed companies in the United States, class action is a Curse that is hard to escape. In the face of the class action of overseas investors, will Ali be hit hard again?

After interviewing a number of lawyers, we found that in the class action against Ali, there was a dispute in the industry about whether Ali had an ant event disclosure obligation, but even if there was a possibility of winning the lawsuit, Ali was still more likely to choose a settlement.

Class action charges Ali: failing to fulfill the disclosure obligation and making misleading statements

Interface news learned that a team of domestic lawyers has joined the class action against Alibaba.

At present, Beijing Hao Junbo law firm is soliciting clues from Alibaba investors, mainly investors who buy or acquire Alibabas stocks or options and other securities from October 21, 2020 to November 3, 2020, and suffer great investment losses.

Interface news learned from Hao Junbos lawyers office that the firm has collected dozens of investors deliveries. At present, the court has accepted the case and is looking for the first plaintiff. According to him, the conditions for US stocks to sue investors are relatively loose and the threshold is low, which is also the main reason why the cases can be accepted.

According to Hao Junbos lawyers English complaint to the interface news (the complaint has been updated to the international lawyers official account), the complaint states that Alibaba owns 33% of the ant group, while Alibaba has not disclosed the following major adverse facts or misleading statements to investors:

(1) Ant group does not meet the listing qualification or disclosure requirements in some important matters;

(3) Due to the above situation, the IPO of ant group may be suspended reasonably;

(4) Due to the above reasons, Alis positive statements on the companys business, operation and prospects are misleading or lack of reasonable basis.

According to the complaint, the suspension of the listing of ants was related to the meeting with the regulatory authorities the day before and the latest changes in the regulatory environment for financial technology. It also quoted the financial times on November 2, 2020 as saying that Chinese regulators met with Ma Yun and Jing Xiandong, senior executives of ant group. Although regulators did not provide details, the Chinese word used to describe the interview - Interview - usually refers to the reprimand of the authorities, the article said The article also included a statement from ant group that it would thoroughly implement the opinions of the meeting.

According to the complaint, it is entirely possible for Alibabas senior executives to know about Alibabas negative non-public information, and have the obligation to disseminate accurate and true information about Alibabas financial situation and operating results, and promptly correct any public statements made by Alibaba.

In addition to the regulatory interview the day before, Hao Junbo also pointed out to the interface news that the new online lending regulations were included in the cbcircs 2019 rules and regulations legislative work plan as early as April 30, 2019, but the plan did not appear in the risk disclosure of the ant prospectus.

It is possible to solicit opinions in advance, in accordance with the companys practice and practice, to solicit opinions in advance.

If Hao Junbo is aware of the relevant risks of the company before it is drafted, it should be disclosed to the investors.

Alis disclosure obligation is controversial and it is difficult to provide evidence

Many lawyers have no objection to the fact that the class action has been accepted by the court. Song Yixin, a partner of Shanghai hanlian law firm, pointed out that the plaintiffs holding of Alis equity and his claim that ants suspension of listing has constituted Alis infringement on the plaintiff, and that the conditions for prosecution have been met, and the courts acceptance is a necessary procedure.

However, he believes that acceptance does not mean victory. Only ant group has the obligation to disclose the relevant announcement about the suspension of listing of ants. As an associated shareholder of ants, Ali is slightly far fetched in its disclosure obligation.

He pointed out that whether there is a causal link between ant groups suspension of listing and Alibabas management remains to be seen. If there is causality before and after, then Ali is likely to lose the lawsuit, but if the causal relationship between the two is weak, then Ali is not likely to have responsibility.

For ants did not disclose the reasons for the drafting of the new rules on small loans online, Guo Handong also expressed disapproval. The reason is very simple. If a piece of legislation is only in the stage of work plan and there is no content, how can it be predicted? How to disclose it?

Professor Sun Hongtao, vice president of the school of law of East China University of political science and law, believes that it is possible for Ali executives to know the new rules in advance, but from the perspective of litigation, there are difficulties in proving that Ali executives know in advance and refuse to disclose subjectively.

Its hard to prove that the executives of ant group knew about this, and even if they did, its hard to prove that Ali executives predicted the seriousness of the new rules, Sun said.

Should premium Dong liability insurance pay?

At present, at the same time of class action, whether the high price Dong liability insurance can compensate has become the key to Alis escape this time.

Directors liability insurance, the full name of which is the liability insurance for directors (supervisors) and senior officers. Generally speaking, if the directors and senior managers of a company suffer economic losses due to their fault when exercising their functions and powers, the risk of corresponding economic compensation liability can be transferred to the insurance company.

As far as the two Dong liability insurance policies are concerned, many lawyers told the interface news that the collective accusation was directed against Ali, rather than the unlisted ant group. Therefore, the 1.5 billion Dong liability insurance of ant group is not necessarily useful. If Ali chooses to settle down or lose the lawsuit, it is very likely that Ali will pay for the liability insurance.

Class action takes a long time. Ali is more likely to settle

Even in this class action against Ali, there is a dispute in the industry about whether Ali has the obligation to disclose the ant incident, and it is difficult to prove Alis responsibility. However, according to Professor Sun Hongtao, Ali is likely to choose a settlement.

Professor Sun Hongtao believes that reaching a settlement is often a more efficient and efficient way to solve problems, and it is also a better choice for listed companies. If we choose to defend, it is very likely to prolong the time of this legal dispute. From the perspective of actual capital operation and practice, falling into a long-term legal dispute is often not conducive to the performance of Listed Companies in the capital market, so it is not necessary to pick up the sesame seeds and lose the melon.

If we choose to settle, the liability insurance company will pay more, and the cost of settlement may be more cost-effective than the high lawyer fees in the United States.

In fact, it is not the first time Ali has encountered a class action lawsuit.

On January 31, 2015, Alibaba, together with its executive team, Ma Yun, Cai Chongxin, Lu Zhaoxi and Wu Wei, encountered class action in the Federal District Court for the Southern District of New York and the state court of California. These two cases or disputes point to the same fact or behavior, that is, an administrative guidance work on the eve of Alibabas listing.

On January 28, 2015, the former State Administration for Industry and Commerce published an article entitled white paper on administrative guidance to Alibaba Group on its official website. It disclosed an administrative guidance forum held in Zhejiang Provincial Bureau of industry and Commerce on July 16, 2014. Alis main responsible personnel and management team of core departments attended the meeting and accepted administrative guidance.

However, in order not to affect Alibabas listing, this is an internal meeting, and Alibaba has not disclosed relevant information in the prospectus.

The two class actions took years to settle. According to Alis announcement, the company paid $75 million and $250 million in December 2018 and April 2019, respectively.

Obviously, Alis patience with the long class action is insufficient. Ali once said that it is meaningless to spend a lot of time and energy on a meeting minutes without any legal effect when the facts are clear. Such a long lawsuit is neither conducive to protecting the interests of shareholders nor helping Ali focus on creating more value for the society.

On November 17, during the glonghui u00b7 global investment Carnival u00b7 2020 held on November 16, Liu Yuhui, Professor of the Institute of economics of the Chinese Academy of Social Sciences, said that the CSRC held a meeting a few days ago, reiterating that it was impossible for ant group to be listed in China.

Recommended reading:

Ants cant be listed in China! Economist Liu Yuhuis latest response

Earlier, some media reported that Liu Yuhui, Professor of the Institute of economics of the Chinese Academy of Social Sciences, said that the CSRC held a meeting a few days ago and reiterated its insistence on sticking to the position of the science and technology innovation board and supporting and encouraging the listing of hard technology enterprises: ant group could not be listed in China.

In response, Liu Yuhui said, today, I was told that what cant go to the market. Well, Im not sure how to say that in this we media era, theres no way out.

Ants are not rich! Hangzhou real estate market, which once rose by 800000 overnight, has been reduced

See him rise high, see him feast guests, see him collapse?

This is a capital carnival. Ant group was originally scheduled to be listed on November 5 with a + H simultaneously, and is expected to become the largest IPO in the world so far.

On the evening of November 3, the Shanghai Stock Exchange issued a decision to suspend the listing of ant Technology Group Co., Ltd. on the science and technology innovation board. Subsequently, the issuance of ants in Hong Kong shares was also announced to be postponed.

Everyone knows about it! But dont get me wrong. Pakchoi doesnt mean that the building of ant group is going to collapse, but the house price in Hangzhou (some places) may not be very good.

At the end of October, after ant announced the IPO pricing, some media even made an account:

According to the issue price of 68.8 yuan, ant group employees and consultants reward a total of 137.7 billion yuan. According to the prospectus, the total number of employees of ant group is 16660, and each employee can get about 8.3 million yuan on average. According to Lianjia data, the average price of second-hand housing in Hangzhou in September was about 29000 yuan. This means that every employee of ant group can buy a luxury house of more than 280 square meters in Hangzhou.

Whether the algorithm is scientific or unscientific, it is no longer important. Such wording is enough to arouse the envy, jealousy and hatred of the ant employees!

However, with the delay of the IPO of ant, all of these things are in vain for the time being!

Once a sudden rise of 800000, now the price is reduced

Since the news of ant listing came out, Hangzhous property market was ready to move.

According to the data of Lianjia, the price of second-hand houses of Yunxi Xinyu in Hangzhou Zhijiang plate has risen sharply. The houses listed for 9 million in June have increased by 800000 in October.

As a matter of fact, for Hangzhou citizens, buying a house with ALI is a well-known way to get rich.

In 1999, Ma Yun founded Alibaba in Room 202, unit 1, building 16, fengheyuan, Hupan garden. The house was about 150 square meters and the total price was 450000 yuan at that time. Today, a house with a similar area in Lakeside Garden costs nearly 9 million yuan.

In 2009, Ali took more than 6000 employees to settle at No. 699, Binjiang shopping road.

Before Alibaba arrived at Binjiang, Hangzhou citizens had a deep prejudice on the land - rather than buying a bed in West Lake instead of buying a riverside suite, they think it is a price cutting behavior to buy a house across the river.

However, the average listing price of Chinese cabbage in the riverside area on this side of the river has already reached 47000 yuan / m2, which can be regarded as a relatively high price area in Hangzhou.

If Ma Yun once regretted the founding of Alibaba, what Hangzhou people most regret is that they didnt buy a suite with ALI.

Therefore, the change of Hangzhous Riverside property market is completely expected by Hangzhou citizens.

In July this year, ant launched the listing process; in September, ant decided to land its headquarters in Zhijiang; on October 21, Ma Yun spent 2.7 billion yuan on land in Zhijiang plate. Zhijiang will soon become the most popular plot in Hangzhou.

An overnight rise of 800000 is not an example here. According to the data of chain home, the average listing price of second-hand houses in Zhijiang in October was 12.4% higher than that in September, and the listing prices of some housing resources went directly to 600000.

Buyers are queuing up at the sales office to pay. Picture / visual China

However, with the delay of the ant IPO, not only let Alibabas share price suffer a rare heavy fall, for the house of Zhijiang plate is also a basin of cold water from the sky. It is reported that many high-level Hangzhou investors cancelled the intention money overnight.

According to the latest data of chain home, in the past week, the average listing price of Zhijiangs second-hand house dropped slightly by 0.1%, while the average transaction price dropped by 5.2% month on month!

Without ants listed to make rich, the current Zhijiang plate temporarily lost the support of high house prices.

Hangzhou property market these years can be said to be enough toss.

Looking back on 2010, the average price of new houses in Hangzhou once ranked first in China. Even Beijing and Shanghai can only look up to this city.

But soon Hangzhous property market changed. On April 17, 2010, the State Council issued the new ten articles for the first time. No matter whether there is a residence registration policy issued in Hangzhou in October, they can only buy a house in Hangzhou. Since then, in 2011, it has been clear that the third set of housing will be closed for sale. Until 2014, the restrictions were finally relaxed.

However, Hangzhou has been hit hard by four years of regulation and control. Since 2010, Hangzhous house price has been in a slump, and the market has been in a downturn, and even the sound of collapse has been heard. However, with the relaxation of regulation and the arrival of the G20 summit, Hangzhous property market began to recover.

Data source: anjuke

Another important factor to be concerned about is the new population of Hangzhou. In the past two years, Hangzhous talent introduction policy has been making constant efforts. In 2019, the newly added population of Hangzhou will reach 554000, ranking first and the only city with a new population exceeding 500000. Among them, there are 210000 College Students under the age of 35, accounting for 38%

According to the latest data released recently, in the first 10 months of this year, 309000 College Students under the age of 35 were newly introduced in Hangzhou, an increase of 45.84% compared with the whole year of 2019. Moreover, not only fresh graduates increased by 30.6%, but all kinds of highly educated talents increased significantly compared with the same period last year.

Data source: Hangzhou Bureau of Statistics

According to the latest report of Shell Research Institute, in terms of urban development potential, Beijing and Guangzhou, the first tier cities, have better urban fundamental development, ranking second in the list respectively; Nanjing and Hangzhou, the new first tier cities, rank third and fourth in terms of urban development potential index, surpassing Shenzhen and Shanghai. In terms of real estate motivation, Hangzhou also ranked sixth, second only to Beijing, Shanghai, Guangzhou, Shenzhen and Chengdu.

In the past two years, Hangzhou, which is dominated by private enterprises and small and medium-sized enterprises, is rich in private capital and has a very active economy. This is also an important reason why it attracts a large number of young people. And these emerging corporate giants will become the potential force of social wealth surge.

With the reform of domestic capital market, the impact of listing on local house price can not be ignored. Investment in real estate, of course, is also a good choice for these dynamic cities. Of course, Pakchoi more and more believes in the concept of housing without speculation, because I think this is not a slogan, but the essence of returning the house. Only a house with high living value is a good asset to maintain the value.

Source: editor in charge of interface news: Chen Hequn_ NB12679