SAN DIEGO–(BUSINESS WIRE)–Robbins Geller Rudman & Dowd LLP announces that a class action lawsuit has been filed in the Central District of California on behalf of purchasers of JOYY Inc. f/k/a YY, Inc. (NASDAQ:YY) securities between April 28, 2016 and November 18, 2020, inclusive (the “Class Period”). The case is captioned Hershewe v. JOYY Inc., No. 20-cv-10611, and is assigned to Judge Stanley Blumenfeld, Jr. The JOYY class action lawsuit charges JOYY and certain of its executives with violations of the Securities Exchange Act of 1934.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased JOYY securities during the Class Period to seek appointment as lead plaintiff in the JOYY class action lawsuit. A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class. A lead plaintiff acts on behalf of all other class members in directing the JOYY class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the JOYY class action lawsuit. An investor’s ability to share in any potential future recovery of the JOYY class action lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff of the JOYY class action lawsuit or have questions concerning your rights regarding the JOYY class action lawsuit, please provide your information here or contact counsel, Michael Albert of Robbins Geller, at 800/449-4900 or 619/231-1058 or via e-mail at firstname.lastname@example.org. Lead plaintiff motions for the JOYY class action lawsuit must be filed with the court no later than January 19, 2021.
JOYY purports to operate a social media platform in the People’s Republic of China and internationally. JOYY describes itself as operating live streaming platforms, including: (a) YY Live, an interactive and comprehensive live streaming social media platform offering music and dance shows, talk shows, outdoor activities, and sports and anime; (b) Bigo Live, which enables users to live stream their specific moments and talk live with each other; and (c) Huya, a game live streaming platform. JOYY also operates short-form video platform, such as Likee, a short-form video social platform that produces, uploads, views, shares, and comments on short-form videos on a daily basis.
The JOYY class action lawsuit alleges that, during the Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (i) JOYY dramatically overstated its revenues from live streaming sources; (ii) the majority of users at any given time were bots; (2) JOYY utilized these bots to effect a roundtripping scheme that manufactured the false appearance of revenues; (iii) JOYY overstated its cash reserves; (iv) JOYY’s acquisition of Bigo was largely contrived to benefit corporate insiders; and (v) as a result, defendants’ public statements were materially false and/or misleading at all relevant times.
On November 18, 2020, Muddy Waters Research published a report alleging that JOYY, among other things: (i) reported fraudulent revenue; (ii) had component businesses that were a fraction of the size that it reported; and (iii) had acquired Bigo as part of a scam that benefitted corporate insiders. Specifically, the Muddy Waters report alleged that up to 90% of JOYY’s live revenue was fake and that the financial statements for the top five JOYY live channel owners showed an 85.9% revenue discrepancy when compared with JOYY. Moreover, according to the report, JOYY engaged in a roundtripping scheme where the majority of the live performers’ gift revenue came from themselves and JOYY-controlled bots. In addition, Muddy Waters also examined JOYY’s Chinese financial statements and allegedly discovered numerous cash discrepancies compared to those filed with the U.S. Securities and Exchange Commission. Finally, Muddy Waters examined JOYY’s acquisition of Bigo and determined that the majority of Bigo’s revenue was fraudulent and the acquisition was designed to enrich defendant David Xueling Li, JOYY’s co-founder, Chairman, and Chief Executive Officer. On this news, the price of JOYY’s American Depositary Receipts fell more than 26%, damaging investors.
Robbins Geller Rudman & Dowd LLP is one of the world’s leading law firms representing investors in securities class action litigation. With 200 lawyers in 9 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For seven consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in the world in both amount recovered for shareholders and total number of class action settlements. Robbins Geller attorneys have helped shape the securities laws and have recovered tens of billions of dollars on behalf of aggrieved victims. Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide. Robbins Geller attorneys are consistently recognized by courts, professional organizations, and the media as leading lawyers in the industry. Please visit http://www.rgrdlaw.com for more information.