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Berger Montague Investigates Securities Fraud Class Action Claims Against Baozun Inc. (NASDAQ: BZUN)

December 18, 2019 GMT
A full-spectrum class action and complex civil litigation law firm, with nationally known attorneys highly sought after for their legal skills. (PRNewsFoto/Berger & Montague, P.C.)
A full-spectrum class action and complex civil litigation law firm, with nationally known attorneys highly sought after for their legal skills. (PRNewsFoto/Berger & Montague, P.C.)

PHILADELPHIA, Dec. 17, 2019 /PRNewswire/ -- Berger Montague announces that a class action lawsuit has been filed against Baozun, Inc. (“Baozun” or the “Company”) (“BZUN”) on behalf of all purchasers of Baozun American Depository Receipts (“ADRs”) between March 6, 2019 and November 20, 2019 (“Class Period”).

If you wish to discuss the claims against Baozun or have any questions concerning your rights or interests, please contact our attorneys Barbara A. Podell, Esq. at (215) 875-4690 or Michael Dell’Angelo, Esq. at (215) 875-3080, or visit www.bergermontague.com.

The complaint alleges that on November 21, 2019, Baozun shocked the market when it announced lower third quarter financial results than the market had been led to expect and provided dismal fourth quarter 2019 guidance. Baozun blamed its poor performance on the adverse “impact from terminating our service agreement with one electronics brand.” Although Baozun did not disclose the name of that large “electronics brand,” the complaint alleges that it was likely Huawei Technologies, Co., Ltd. (“Huawei”), a Chinese multinational technology company that had been one of Baozun’s largest brand partners on a historical basis. Baozun did not disclose to investors that it cut off its lucrative relationship with Huawei after Huawei took much of its online merchandising in-house. Instead, Baozun falsely represented that it was proactively focusing its own portfolio to emphasize higher quality brand partners going forward in order to optimize revenue and profitability.

The complaint alleges that during the first half of 2019, the revenues Baozun received for its work for Huawei caused Baozun to report promising revenue growth, resulting in the artificial inflation of the price of its ADRs. Baozun took advantage of the artificial inflation and cashed in on it by selling at least 2.25 million ADRs in a registered public stock offered at $40 per ADR around April 10, 2019, thereby raising $90 million dollars. That same day, Baozun also closed a concurrent offering of $225 million of convertible senior notes due 2024, receiving net proceeds of about $269 million—all without disclosing the loss of a major partner.

Defendants’ statements during the Class Period were materially false and misleading when made because they failed to disclose that:

When the disappointing third quarter 2019 results and the “termination” of the Huawei service agreement were announced on November 21, 2019, the price of Baozun ADRs plummeted by $7.60 or about 17.5% to close at $35.90 on unusually heavy trading volume of more than 8.2 million ADRs—more than eight times the average daily volume over the preceding ten days.

If you purchased Baozun ADRs during the Class Period and suffered damages, you may, no later than February 8, 2020, request that the Court appoint you lead plaintiff of the proposed Class. You do not need to be a lead plaintiff to share in any possible recovery to the Class.

Berger Montague, with offices in Philadelphia, Minneapolis, Washington, D.C., and San Diego, has been a pioneer in securities class action litigation since its founding in 1970. Berger Montague has represented individual and institutional investors for five decades and serves as lead counsel in courts throughout the United States.

Contacts

Barbara A. Podell, Shareholder
Berger Montague
(215) 875-4690
bpodell@bm.net
www.bergermontague.com

Michael Dell’Angelo, Managing Shareholder
Berger Montague
(215) 875-3080
mdellangelo@bm.net
www.bergermontague.com

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SOURCE Berger Montague