New York, New York--(Newsfile Corp. - April 3, 2020) - Faruqi & Faruqi, LLP, a leading national securities law firm, reminds investors in Luckin Coffee Inc. (NASDAQ: LK) ("Luckin Coffee" or the "Company") of the April 13, 2020 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
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If you invested in Luckin Coffee stock or options between May 17, 2019 and April 2, 2020 and would like to discuss your legal rights, click here: www.faruqilaw.com/LK. There is no cost or obligation to you.
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Attn: Richard Gonnello, Esq.
Telephone: (877) 247-4292 or (212) 983-9330
The lawsuit has been filed in the U.S. District Court for the Eastern District of New York on behalf of all those who purchased Luckin Coffee securities between November 13, 2019 and January 31, 2020 (the "Class Period"). The case, Sterckx v. Luckin Coffee Inc. et al, No. 20-cv-01677 was filed on April 2, 2020.
The lawsuit focuses on whether the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose that: (1) certain of Luckin's financial performance metrics, including per-store per-day sales, net selling price per item, advertising expenses, and revenue contribution from "other products" were inflated; (2) Luckin's financial results thus overstated the Company's financial health and were consequently unreliable and would likely require restatement; and (3) as a result, Defendants' statements about Luckin's business, operations, and prospects were materially false and/or misleading and/or lacked a reasonable basis at all relevant times.
Specifically, on January 31, 2020, Muddy Waters Research published an anonymous report alleging that Luckin Coffee had fabricated certain of the Company's financial performance metrics, beginning in the third quarter of 2019 ("3Q19") (the "Muddy Waters Report"). The Muddy Waters Report purported to cite "smoking gun evidence," including, inter alia, thousands of hours of store video, thousands of customer receipts, and diligent monitoring of the Company's mobile application metrics, which allegedly showed that, since 3Q19, Luckin Coffee had inflated its per-store per-day sales figures, its net selling price per item, its advertising expenses, and its revenue contribution from "other products."
On this news, Luckin Coffee's stock fell from a closing price of $36.40 on January 30, 2020 to $32.49 on January 31, 2020-a $3.91 or 10.74% drop.
Then, on April 2, 2020, Luckin disclosed that an internal investigation had found that millions of dollars in sales were fabricated.
On this news, Luckin Coffee's stock fell from a closing price of $26.20 on April 1, 2020 to $6.40 on April 2, 2020-a $19.80 or 74.57% drop.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Luckin Coffee's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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