SAN DIEGO--(BUSINESS WIRE)--Robbins Geller Rudman & Dowd LLP announces that the lead plaintiff motion deadline in the Canaan securities class action lawsuit is May 4, 2020. A securities class action lawsuit was filed in the District of Oregon charging Canaan Inc. (NASDAQ:CAN), certain of its officers and directors, and the underwriters of its November 20, 2019 initial public offering (“IPO”) with violations of the Securities Act of 1933. The case is captioned Lemieux v. Canaan Inc., No. 20-cv-356, and is assigned to Judge Michael W. Mosman.
The Canaan securities class action lawsuit alleges that the Registration Statement for the IPO was materially false and misleading and failed to disclose to investors that: (1) the purported “strategic cooperation” between Canaan and Hangzhou Grandshores Weicheng Technology Co., Ltd. (“Grandshores”) was actually a related-party transaction; (2) Canaan’s financial health was worse than it had reported; (3) Canaan had removed numerous distributors from its website just prior to the IPO, many of which were small or suspicious businesses; and (4) several of Canaan’s largest Chinese clients in prior years were clients who were not in the Bitcoin mining industry and, thus, would likely not be repeat customers.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Canaan securities pursuant to the IPO to seek appointment as lead plaintiff in the Canaan securities class action lawsuit. A lead plaintiff acts on behalf of all other class members in directing the Canaan securities class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Canaan securities class action lawsuit. An investor’s ability to share in any potential future recovery of the Canaan securities class action lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff of the Canaan securities class action lawsuit or have questions concerning your rights regarding the Canaan securities class action lawsuit, please visit our website by clicking here or contact Brian Cochran at 800/449-4900 or 619/231-1058, or via e-mail at bcochran@rgrdlaw.com. Lead plaintiff motions for the Canaan securities class action lawsuit must be filed with the court no later than May 4, 2020.
Canaan designs, manufactures, and sells Bitcoin mining machines globally. On October 27, 2019, Canaan entered into a “strategic cooperation” agreement with Grandshores pursuant to which Grandshores agreed to purchase from or distribute on behalf of Canaan up to $150 million USD worth of equipment.
On February 20, 2020, Marcus Aurelius Value published a report explaining Canaan’s numerous allegedly false and/or misleading statements. Specifically, the report noted that Canaan’s strategic partnership with Grandshores was actually a related-party transaction and “farcical on its face[,] because Grandshore’s market cap is a mere $50 Million USD and it reports having only $16 Million USD in cash on hand, nowhere near the financial wherewithal to buy this much equipment.” The report also noted that Canaan was sued in 2019 by a vendor for allegedly failing to pay an invoice of approximately $1.7 million, with the vendor further alleging that Canaan “said it couldn’t pay because of ‘sales problems and market circumstances.’” The report further stated that Canaan had “abruptly deleted 8 of the 11 unique distributors that were featured on its website shortly before” the IPO and that “most appear to be small, defunct, or otherwise incapable of buying material amounts of product from [Canaan].” The report also raised questions about the sustainability of Canaan’s customer base. On this news, the price of Canaan’s ADSs fell by nearly 7%. By the commencement of the Canaan securities class action lawsuit, the price of Canaan’s ADSs had declined to $4.66 per share – nearly 50% below the IPO price.
Robbins Geller Rudman & Dowd LLP is one of the world’s leading law firms representing investors in securities litigation. With 200 lawyers in 9 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For seven consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in the world in both amount recovered for shareholders and total number of class action settlements. Robbins Geller attorneys have helped shape the securities laws and have recovered tens of billions of dollars on behalf of aggrieved victims. Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide. Robbins Geller attorneys are consistently recognized by courts, professional organizations, and the media as leading lawyers in the industry. Please visit http://www.rgrdlaw.com for more information.
