Did you lose money on investments in Gaotu Techedu? If so, please visit Gaotu Techedu Inc. Shareholder Class Action Lawsuit or contact Peter Allocco at (212) 951-2030 or pallocco@bernlieb.com to discuss your rights.
NEW YORK, Jan. 23, 2023 (GLOBE NEWSWIRE) -- Bernstein Liebhard LLP, a nationally acclaimed investor rights law firm, reminds investors of the deadline to file a lead plaintiff motion in a securities class action lawsuit that has been filed on behalf of investors who purchased or acquired the American Depositary Shares (“ADSs”) of Gaotu Techedu Inc. f/k/a GSX Techedu Inc. (“Gaotu” or the “Company”) (NYSE: GOTU, GSX) between March 5, 2021 and July 23, 2021, inclusive (the “Class Period”). The lawsuit was filed in the United States District Court for the Eastern District of New York and alleges violations of the Securities Exchange Act of 1934.
Gaotu purports to be a technology-driven education company, providing online K-12 after-school tutoring services in the People’s Republic of China.
Plaintiff alleges that Defendants made materially false and misleading statements throughout the Class Period. Specifically, Plaintiff alleges that Defendants failed to disclose 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; and (2) such regulations would have a negative impact on Gaotu’s operations and profitability and the value of Company securities.
On July 23, 2021, Reuters reported that China was barring tutoring for profit in core school subjects to ease financial pressures on families that have contributed to low birth rates, news that sent shockwaves through its vast private education sector and share prices plunging. The move threatened to decimate China’s $120 billion private tutoring industry and triggered a heavy selloff in shares of tutoring firms traded in Hong Kong and New York including New Oriental Education & Technology Group and Koolearn Technology Holding Ltd. Further, all institutions offering tutoring on the school curriculum were to be registered as non-profit organizations, and no new licenses were being granted.
On this news, the Company’s ADSs fell $6.06, or over 63%, to close at $3.52 per share on July 23, 2021.
Then, on November 6, 2021, the Financial Times published an article entitled “How China’s tech bosses cashed out at the right time-Sales of US-listed shares came ahead of significant moves in price.” Among other things, the article stated that “[i]n one previously unreported trade, a shell company holding shares for executives at GSX Techedu, whose market capitalisation in New York was about $24bn at the time, launched the sale of shares worth as much as $119m just three days after Xi spoke. . . . [On November 6, 2021], the block of GSX shares that was put up for sale in March would be worth only $4m.”
If you wish to serve as lead plaintiff, you must move the Court no later than February 28, 2023. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. Your ability to share in any recovery doesn’t require that you serve as lead plaintiff. If you choose to take no action, you may remain an absent class member.
If you purchased Gaotu ADSs, and/or would like to discuss your legal rights and options please visit Gaotu Techedu Inc. Shareholder Class Action Lawsuit or contact Peter Allocco at (212) 951-2030 or pallocco@bernlieb.com.
Since 1993, Bernstein Liebhard LLP has recovered over $3.5 billion for its clients. In addition to representing individual investors, the Firm has been retained by some of the largest public and private pension funds in the country to monitor their assets and pursue litigation on their behalf. As a result of its success litigating hundreds of lawsuits and class actions, the Firm has been named to The National Law Journal’s “Plaintiffs’ Hot List” thirteen times and listed in The Legal 500 for ten consecutive years.
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Contact Information:
Peter Allocco
Bernstein Liebhard LLP
https://www.bernlieb.com
(212) 951-2030
pallocco@bernlieb.com
