U.S. Court Refuses to Allow Securities Case Against Chinese Company to Proceed as a Class Action Because its Securities Were Too Thinly Traded
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Key takeaways:
- U.S. securities claims cannot be litigated on behalf of a broad class unless the securities traded on an "efficient market."
- In a new case, a judge held that claims brought against a reverse-merged Chinese company could not proceed as a class action because the company's securities were thinly traded and not well covered by analysts.