The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the District of Oregon on behalf of those who acquired Canaan Inc. (“Canaan” or the “Company”) (NASDAQ: CAN) securities pursuant and/or traceable to the Company’s November 20, 2019 initial public offering (“IPO”). Investors have until May 4, 2020 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
The lawsuit alleges that the Company failed to disclose that: (i) the purported “strategic cooperation” was actually a transaction with a related party; (ii) the Company’s financial health was worse than what was actually reported; (iii) the Company had recently removed numerous distributors from its website just prior to the IPO, many of which were small or suspicious businesses; and (iv) several of the Company’s largest Chinese clients in prior years were clients who were not in the Bitcoin mining industry and, thus, would likely not be repeat customers.
In November 2019, Canaan completed its initial public offering (“IPO”), selling 10 million American Depositary Shares (“ADSs”) priced at $9.00 per ADS.
On February 20, 2020, an investment analyst publishing under the pseudonym Marcus Aurelius published a short report alleging that, among other things, Canaan was engaged in several undisclosed related-party transactions that lacked economic substance, including the sale of $150 million worth of equipment to a small Hong Kong company with an undisclosed relationship with a significant Canaan shareholder.
On this news, Canaan’s ADS price fell $0.39 per share, or 6.8%, to close at $5.32 per share on February 20, 2020. Since the IPO, Canaan’s ADSs have traded as low as $4.40 per share, representing a decline of more than 51% from the offering price.
If you acquired Canaan securities, have information, or would like to learn more about these claims, please contact Thomas W. Elrod of Kirby McInerney LLP at 212-371-6600, by email at firstname.lastname@example.org, or by filling out this contact form, to discuss your rights or interests with respect to these matters without any cost to you.