Bernstein Liebhard LLP Announces That A Class Action Has Been Filed Against Vipshop Holdings Ltd.
July 2, 2015
Bernstein Liebhard LLP today announced that a class action has been commenced in the United States District Court for the Southern District of New York on behalf of shareholders (the “Class”) who purchased Vipshop Holdings Limited (“Vipshop” or the “Company”) (NYSE: VIPS) securities between February 17, 2015 and May 18, 2015 (the “Class Period”). The complaint charges Vipshop and certain of its officers and directors with violations of the Securities Exchange Act of 1934.
Vipshop Holdings Limited, through its subsidiaries, operates as an online discount retailer for various brands in the People’s Republic of China.
The complaint alleges throughout the Class Period, defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, the complaint alleges defendants made false and/or misleading statements and/or failed to disclose that: (1) Vipshop manipulated and overstated sales, receivables, profit, cash flows, and asset accounts including inventory and investments; (2) Vipshop’s financial statements contain GAAP violations by reporting revenue on a ‘gross’ basis, despite the fact that the vast majority of the company’s sales are under a consignment arrangement; (3) Vipshop’s internal controls over financial reporting were ineffective; and (4) as a result of the foregoing, Vipshop’s public statements were materially false and misleading at all relevant times.
On May 12, 2015, a report published by Mithra Forensic Research asserted, among other things, that forensic models suggest that Vipshop manipulated sales, receivables, profit, and other asset accounts, and that Vipshop’s financial statements have been contradicted by statements by Vipshop’s management. On this news, shares of Vipshop fell $1.54 per share, or 5.6%, to close at $25.78.
On May 14, 2015, a J Capital Research report stated that the Company’s “financial filings in China are vastly different than its filings with the Securities and Exchange Commission.” On this news, shares of Vipshop fell $1.45 per share, or 5.4%, to close at $25.21.
On May 29, 2015, Mithra Forensic Research published another report, asserting, among other things, that “we have found additional information which suggests that VIPS continues to misrepresent [affiliate] Lefeng’s revenues,” and that “[s]ignificant and growing losses at Lefeng and Ovation are likely driven by VIPS pushing Operating Expenses onto them.” On this news, shares of Vipshop declined more than 1.6%, to close at $24.97.
Plaintiffs seek to recover damages on behalf of all Class members who invested in Vipshop securities during the Class Period. If you invested in Vipshop as described above, and either lost money on the transaction or still hold the security, you may wish to join in this action to serve as lead plaintiff. In order to do so, you must meet certain requirements set forth in the applicable law and file appropriate papers no later than July 20, 2015.
A “lead plaintiff” is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as lead plaintiff. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Bernstein Liebhard LLP, or other counsel of your choice, to serve as your counsel in this action.
If you are interested in discussing your rights as a Vipshop shareholder and/or have information relating to the matter, please contact Joseph R. Seidman, Jr. at (877) 779-1414 or firstname.lastname@example.org.
Bernstein Liebhard LLP has pursued hundreds of securities, consumer and shareholder rights cases and recovered over $3 billion for its clients. The National Law Journal has recognized Bernstein Liebhard for twelve consecutive years as one of the top plaintiffs’ firms in the country.
You can obtain a copy of the complaint from the clerk of the court for the United States District Court for the Southern District of New York.