NEW YORK — Labaton Sucharow LLP (“Labaton Sucharow”) announces that on April 17, 2020, it filed a securities class action lawsuit, captioned Shiferaw v. iQIYI, Inc., No. 20-cv-3115 (S.D.N.Y.) (the “Action”), on behalf of its client Sintayehu Shiferaw (“Shiferaw”) against iQIYI, Inc. (“iQIYI” or the “Company”) (NASDAQ: IQ) and certain executive officers (collectively, “Defendants”). The Action asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and SEC Rule 10b-5 promulgated thereunder, on behalf of all persons or entities who purchased or otherwise acquired iQIYI’s securities between March 29, 2018 through April 7, 2020, both dates inclusive (the “Class Period”), who were damaged thereby (the “Class”).
iQIYI operates a Chinese online streaming platform which is currently one of the largest video-based websites in the world, with on-demand video content. The Company generates its revenue primarily from membership services and online advertising. The Action alleges that, during the Class Period, Defendants made materially false and/or misleading statements and omissions. Specifically, Defendants overstated iQIYI’s 2019 revenue by 27%-44% and the Company’s user numbers by 42%-60%. iQIYI also inflated its expenses to conceal these misstatements from investors.
This fraud was revealed on April 7, 2020 by Wolfpack Research. On that date, Wolfpack Research published a 37-page report detailing Defendants’ scheme to defraud investors. Among other things, this report explained how iQIYI had materially overstated its revenue and subscriber numbers. On this news, iQIYI’s American Depositary Shares (“ADSs”) fell $1.01 per share, or 5.8 percent, over the remainder of the day and the next full trading day to close at $16.51 per share April 8, 2020. As a result of Defendants false and/or misleading statements and/or omissions, the Class suffered harm under the Exchange Act.
If you purchased iQIYI securities, including ADSs, during the Class Period and were damaged thereby, you are a member of the Class and may be able to seek appointment as Lead Plaintiff. Lead Plaintiff motion papers must be filed with the U.S. District Court for the Southern District of New York no later than June 15, 2020. The Lead Plaintiff is a court-appointed representative for absent members of the Class. You do not need to seek appointment as Lead Plaintiff to share in any Class recovery in the Action. If you are a Class member and there is a recovery for the Class, you can share in that recovery as an absent Class member. You may retain counsel of your choice to represent you in the Action.
If you would like to consider serving as Lead Plaintiff or have any questions about this lawsuit, you may contact David J. Schwartz, Esq. of Labaton Sucharow, at (800) 321-0476, or via email at firstname.lastname@example.org.
Shiferaw is represented by Labaton Sucharow. which represents many of the largest pension funds in the United States and internationally with combined assets under management of more than $2 trillion. Labaton Sucharow has been recognized for its excellence by the courts and peers, and it is consistently ranked in leading industry publications. Offices are located in New York, NY, Wilmington, DE, and Washington, D.C. More information about Labaton Sucharow is available at www.labaton.com.
You can view a copy of the complaint here.