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The law firm of Kessler Topaz Meltzer & Check, LLP informs investors that a securities class action lawsuit has been filed against Cloopen Group Holding Limited. The action charges Cloopen with violations of the federal securities laws, including omissions and fraudulent misrepresentations relating to the company’s business, operations, and prospects. As a result of Cloopen’s materially misleading statements to the public, Cloopen investors have suffered significant losses.
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
CLOOPEN’S ALLEGED MISCONDUCT
Cloopen provides cloud-based communications solutions which allow application programing interfaces and software development kits to embed messaging, voice call, audio and video, instant messaging, and other communications into enterprises’ applications, services, and/or business processes.
On February 9, 2021, Cloopen conducted its initial public offering (“IPO”), selling 23 million American Depositary Shares (“ADSs”) at $16.00 per ADS. Then, on March 26, 2021, Cloopen published its 2020 fourth quarter financial results for the period ending December 31, 2020. Cloopen reported revenues of only $39.6 million ($2 million short of analysts’ consensus), as well as net losses of $46.8 million (a 466.9% increase year-over-year), and operating expenses of $27.6 million (a 30% increase over the fourth quarter of 2019). In response to its alarming net loss, Cloopen blamed a “change in fair value of warrant liabilities of . . . US$34.4 million.” With regard to its 59.2% increase in general and administrative expenses, Cloopen claimed “an increase in the provision for doubtful accounts resulting from increased in accounts receivables.” Following this news, Cloopen’s ADS price fell $2.67 per ADS, or 18.52%, to close at $11.75 per ADS on March 26, 2021.
Then, on May 10, 2021, Cloopen’s share price fell again when the company filed its 2020 annual report and revealed for the first time that its dollar-based net customer retention rate for recurring solutions had fell from 102.7% in 2019 to 86.8% by year end 2020. Following this news, Cloopen’s ADS price fell $0.62 per ADS, or 6.47%, to close at $8.97 per ADS on May 12, 2021.
WHAT CAN I DO?
Cloopen investors may, no later than February 8, 2022, 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 Cloopen investors who have suffered significant losses to contact the firm directly to acquire more information.
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
