NEW YORK, Nov. 06, 2019 (GLOBE NEWSWIRE) -- Pomerantz LLP announces that a class action lawsuit has been filed on behalf of shareholders of Up Fintech Holding Limited (“Up Fintech” or the “Company”) (NASDAQ: TIGR) against certain of the Company’s officers. The class action, filed in United States District Court, for the Southern District of New York, and indexed under 19-cv-10326, is on behalf of a class consisting of all persons and entities other than Defendants who purchased or otherwise, acquired: (a) Fintech American Depository Shares (“ADSs”) pursuant and/or traceable to the Company’s initial public offering conducted on or about March 20, 2019 (the “IPO” or “Offering”); or (b) Fintech securities between March 20, 2019 and May 16, 2019, both dates inclusive (the “Class Period”). Plaintiff pursues claims against the Defendants under the Securities Act of 1933 (the “Securities Act”) and the Securities Exchange Act of 1934 (the “Exchange Act”).
If you are a shareholder who purchased (a) Fintech American Depository Shares pursuant and/or traceable to the Company’s initial public offering conducted on or about March 20, 2019; or (b) Fintech securities between March 20, 2019 and May 16, 2019, you have until January 6, 2020, to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at email@example.com or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
Fintech was founded in 2014 and is based in Beijing, China. The Company provides online brokerage services focusing on Chinese investors and has developed a purported brokerage platform that can be accessed through its app and website. The Company offers brokerage and value-added services, including trade order placement and execution, margin financing, account management, investor education, community discussion, and customer support.
On February 22, 2019, Fintech filed a registration statement on Form F-1 with the SEC in connection with the IPO (Registration No. 333-229808), which, after several amendments, was declared effective by the SEC on March 19, 2019 (the “Registration Statement”). The Registration Statement was filed with respect to the underlying Class A ordinary shares represented by the ADSs to be sold in the IPO.
On March 20, 2019, Fintech filed a prospectus for the IPO on Form 424B4 (the “Prospectus”), which incorporated and formed part of the Registration Statement (collectively, the “Offering Documents”). That same day, Fintech announced the pricing of its IPO of 13 million ADSs, each representing fifteen Class A ordinary shares of the Company, at $8.00 per ADS. The ADSs began trading the same day on the Nasdaq Global Select Market (“NASDAQ”) under the symbol “TIGR.” Fintech raised $104 million in proceeds from the IPO.
The complaint alleges that the Offering Documents were negligently prepared and, as a result, contained untrue statements of material fact or omitted to state other facts necessary to make the statements made not misleading and were not prepared in accordance with the rules and regulations governing their preparation. Additionally, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, in the Offering Documents and during the Class Period, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Fintech was experiencing a material decrease in commissions because of a negative trend related to risk-averse investors in the market; (ii) Fintech was unable to absorb costs associated with the rapid growth of its business and its status as a publicly listed company on a U.S. exchange; (iii) Fintech was incurring significant additional expenses related to, inter alia, employee headcount and employee compensation and benefits; (iv) all of the foregoing had led to Fintech significantly increasing operating costs and expenses; and (v) as a result, the Offering Documents were materially false and/or misleading and failed to state information required to be stated therein, and the Company’s Class Period statements were likewise materially false and/or misleading.
On May 17, 2019, during pre-market hours, Fintech issued a press release announcing its unaudited first quarter 2019 financial results—the Company’s first quarterly earnings announcement following the IPO (the “1Q19 Press Release”). In that press release, Fintech disclosed a 4.1% decrease in commissions, noting that “[i]nvestors were relatively risk averse at beginning of this year which leads to moderated trading activities and a slight decrease in trading commission.” The 1Q19 Press Release also disclosed, among other issues, that Fintech’s operating costs and expenses and net loss attributable to the Company had begun to skyrocket as a result of increases in expenses related to employee headcount, employee compensation and benefits, and office space and leasehold improvements, as well as rapid customer growth, expanded market data usage for its customers, and additional professional expenses as a listed company.
Specifically, with respect to Fintech’s drastically increasing operating costs and expenses and net loss attributable to the Company, the 1Q19 Press Release disclosed that total operating costs and expenses for the first quarter of 2019 increased by 36.4% to $14.0 million from $10.3 million in the first quarter of 2018, and that employee compensation and benefits increased by 60.8% from $4.9 million in the first quarter of 2018 to $7.8 million in the first quarter of 2019.
On this news, Fintech’s ADS price fell $1.21 per share, or 17.34%, to close at $5.77 per share on May 17, 2019.
The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, and Paris, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com
Robert S. Willoughby