RM LAW, P.C. announces that a class action lawsuit has been filed on behalf of all persons or entities that purchased Luckin Coffee Inc. ("Luckin" or the "Company") (NASDAQ: LK) securities during the period between May 17, 2019 and April 2, 2020, inclusive (the “Class Period”).
Luckin shareholders may, no later than April 13, 2020, move the Court for appointment as a lead plaintiff of the Class. If you purchased shares of Luckin and would like to learn more about these claims or if you wish to discuss these matters and have any questions concerning this announcement or your rights, contact Richard A. Maniskas, Esquire toll-free at (844) 291-9299 or to sign up online, click here.
The complaint alleges that defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose: (1) that certain of Luckin’s financial performance metrics, including per-store per-day sales, net selling price per item, advertising expenses, and revenue contribution from "other products" were inflated; (2) that Luckin’s financial results thus overstated the Company’s financial health and were consequently unreliable; and (3) that, as a result, the Company’s public statements were materially false and misleading at all relevant times.
On January 31, 2020, Muddy Waters Research ("Muddy Waters") published an anonymous report alleging that Luckin "had evolved into a fraud by fabricating financial and operating numbers starting in [the] 3rd quarter 2019." Among other allegations, Muddy Waters claims that the "[n]umber of items per store per day was inflated by at least 69% in 2019 3Q and 88% in 2019 4Q" and that "Luckin inflated its net selling price per item by at least RMB 1.23 or 12.3%."
On this news, Luckin’s share price fell $3.91, or nearly 11%, to close at $32.49 per share on January 31, 2020, thereby injuring investors.
Then, on April 2, 2020, before the market opened, Luckin disclosed that "beginning in the second quarter of 2019, Mr. Jian Liu, the chief operating officer and a director of the Company, and several employees reporting to him, had engaged in certain misconduct, including fabricating certain transactions." The Company further revealed that "the aggregate sales amount associated with the fabricated transactions from the second quarter of 2019 to the fourth quarter of 2019 amount to around RMB2.2 billion." As a result, the COO was suspended, and Luckin stated that previously issued financial statements should no longer be relied upon.
On this news, the Company's share price fell as much as $19.28, or over 74%, during intraday trading on April 2, 2020, thereby injuring investors further.
If you are a member of the class, you may, no later than April 13, 2020, request that the Court appoint you as lead plaintiff of the class. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain RM LAW, P.C. or other counsel of your choice, to serve as your counsel in this action.