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Press release content from Globe Newswire. The AP news staff was not involved in its creation.
PRESS RELEASE: Paid content from Globe Newswire
Press release content from Globe Newswire. The AP news staff was not involved in its creation.

GOTU CLASS ACTION ALERT: Kessler Topaz Meltzer & Check, LLP Reminds Gaotu Techedu Inc. Shareholders of Securities Fraud Class Action Lawsuit

November 9, 2021 GMT

RADNOR, Pa., Nov. 09, 2021 (GLOBE NEWSWIRE) -- The law firm of Kessler Topaz Meltzer & Check, LLP informs investors that a class action lawsuit has been filed in the United States District Court for the Southern District of New York against Goldman Sachs Group Inc. (“Goldman Sachs”) and Morgan Stanley (collectively, “Defendants”), charging both companies with violations of the federal securities laws, including insider trading, relating to their unlawful disposal of Gaotu Techedu Inc. f/k/a GSX Techedu Inc. (“Gaotu”) (NYSE: GOTU) American Depository Shares. Defendants’ unlawful sales of Gaotu shares allowed them collectively to avoid billions in losses while investors suffered significantly.

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CLICK HERE TO SUBMIT YOUR GAOTU LOSSES

LEAD PLAINTIFF DEADLINE: December 20, 2021

CLASS PERIOD: March 22, 2021 through March 29, 2021

CONTACT AN ATTORNEY TO DISCUSS YOUR RIGHTS:
James Maro, Esq. (484) 270-1453 or Toll Free (844) 887-9500 or Email at info@ktmc.com

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DEFENDANTS’ ALLEGED MISCONDUCT
Both Goldman Sachs and Morgan Stanley are global financial services institutions that served as the prime brokers for Archegos Capital Management (“Archegos”), a family office investment fund with $10 billion under management and whose assets included ViacomCBS Inc. (“ViacomCBS”) and Gaotu, both of which Archegos had big concentrated positions in. Unbeknownst to investors and regulators, Defendants had simultaneously allowed Archegos to take on billions of dollars of exposure to volatile equities through swaps contracts, dramatically elevating the risk posed by these concentrated positions.

On March 25, 2021, MoffettNathanson published a report questioning ViacomCBS’s value, downgrading the stock to a “sell,” and setting a price target of only $55 per share, compared to the company’s $85 offer. Following that report, ViacomCBS’s stock fell dramatically and closed at $48 per share on Friday, March 26, 2021. Since Archegos had traded ViacomCBS on margin, it was required to maintain a certain amount of collateral to avoid triggering a margin call. On March 27, 2021, it was reported that Archegos failed to cover and, as a result, had to liquidate more than $20 billion of its leveraged equity positions on Friday, March 26, 2021.

Then, on April 6, 2021, CNBC.com reported that “Morgan Stanley sold about $5 billion in shares from Archegos’ doomed bets on U.S. media and Chinese tech names to a small group of hedge funds late Thursday, March 25,” before the MoffettNathanson report reached the public. The article also reported that Goldman Sachs quickly disposed of its shares tied to Archegos. These sales by Defendants were made with confidential, insider information, including that Gaotu was among the few securities Archegos had to liquidate, and allowed Defendants to unlawfully avoid billions of dollars in losses combined.

WHAT CAN I DO?
Gaotu investors may, no later than December 20, 2021, seek to be appointed as a lead plaintiff representative of the class through Kessler Topaz Meltzer & Check, LLP or other counsel, or may choose to do nothing and remain an absent class member.  Kessler Topaz Meltzer & Check, LLP encourages Gaotu investors who have suffered significant losses to contact the firm directly to acquire more information.

CLICK HERE TO SIGN UP FOR THE CASE

WHO CAN BE A LEAD PLAINTIFF?
A lead plaintiff is a representative party who acts on behalf of all class members in directing the litigation. The lead plaintiff is usually the investor or small group of investors who have the largest financial interest and who are also adequate and typical of the proposed class of investors. The lead plaintiff selects counsel to represent the lead plaintiff and the class and these attorneys, if approved by the court, are lead or class counsel. Your ability to share in any recovery is not affected by the decision of whether or not to serve as a lead plaintiff.

ABOUT KESSLER TOPAZ MELTZER & CHECK, LLP
Kessler Topaz Meltzer & Check, LLP prosecutes class actions in state and federal courts throughout the country and around the world. The firm has developed a global reputation for excellence and has recovered billions of dollars for victims of fraud and other corporate misconduct. All of our work is driven by a common goal: to protect investors, consumers, employees and others from fraud, abuse, misconduct and negligence by businesses and fiduciaries. At the end of the day, we have succeeded if the bad guys pay up, and if you recover your assets. The complaint in this action was not filed by Kessler Topaz Meltzer & Check, LLP. For more information about Kessler Topaz Meltzer & Check, LLP please visit www.ktmc.com.

CONTACT:
Kessler Topaz Meltzer & Check, LLP
James Maro, Jr., Esq.
280 King of Prussia Road
Radnor, PA 19087
(844) 887-9500 (toll free)
info@ktmc.com