Alibaba, a Chinese e-commerce company, announced on Friday that it has reached a settlement of $433.5 million to resolve a class-action lawsuit brought by investors in the United States that accused the company of engaging in monopolistic acts.
Alibaba said it signed the deal to save the expense and inconvenience of additional litigation, and it denied any wrongdoing.
The proposed settlement, which needs U.S. approval, was filed in federal court in Manhattan. George Daniels, the district judge. In the 2020 lawsuit, Alibaba argued that, despite forcing merchants to select just one distribution network, it did not break anti-monopoly or unfair competition rules.
The settlement addresses claims that investors who purchased American depositary shares of Alibaba between November 13, 2019, and December 23, 2020, lost money when the stock price dropped after the market realized Alibaba had made false statements.
In their court filings, plaintiffs’ attorneys referred to the proposed transaction as “an exceptional result,” stating that it significantly outpaced the median recovery in securities class actions when investor losses topped $10 billion.
Alibaba Group case is U.S. District Court
According to Benzinga the lawyers, the Alibaba investors might have pursued a maximum damages award of $11.63 billion if they had persisted in their litigation. The case is U.S. District Court, Southern District of New York, No. 20-09568, re Alibaba Group Holding Ltd Securities Litigation.
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