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BABA.US
id: 1376

Alibaba (BABA) $433M Investor Settlement

$433,500,000
Cash Settlement
S.D. New York
Court
1:20-cv-09568
Case number
11/13/2019
Class period Start
12/23/2020
Class period End
03/26/2025
Claim deadline

Alibaba (BABA) agreed to a $433.5 million settlement with investors over claims it misled them about Ant Group's regulatory issues that affected its IPO and lending activities.

Outline

A few years back, Alibaba faced major regulatory hurdles as its affiliate, Ant Group, was set to go public with a highly anticipated IPO. Right before the launch, Chinese regulators raised concerns about Ant's compliance with new lending and credit rules, forcing delays and a restructuring. Following this news, $BABA fell significantly, and Alibaba faced a lawsuit from shareholders.

Timeline

  • November 5, 2019: Chinese regulators, including SAMR, warned Alibaba and other tech firms about complying with antitrust and financial laws.

  • November 2, 2020: Ant Group executives were summoned by China’s central bank and other regulators over compliance with new rules.

  • November 3, 2020: Regulators announced the suspension of Ant’s IPO.

  • In response, $BABA dropped by 8% from the prior day.

  • December 23, 2020: Chinese authorities revealed a new antitrust investigation into Alibaba.

  • December 24, 2020: $BABA saw one of its largest one-day drops in history, falling 13%.

  • April 22, 2022: Alibaba faced a lawsuit from investors.

Background

In July 2020, Ant Group announced a record $30 billion IPO in Hong Kong and Shanghai, generating investor excitement and positioning the Alibaba affiliate as a key player in transforming China's financial services.

However, Jack Ma, Alibaba’s founder, publicly criticized China's outdated financial regulations, leading to increased scrutiny of Ant's high-risk consumer lending practices.

On November 2, 2020, Chinese regulators summoned Ant Group executives, including Ma, to discuss compliance with new financial regulations on consumer lending.

On November 3, 2020, regulators announced the suspension of Ant’s IPO.

In response, $BABA dropped by 8.1% from the prior day.

Subsequently, the State Administration for Market Regulation (SAMR) launched an antitrust investigation into Alibaba for alleged monopolistic practices.

Following this news, $BABA saw one of its largest one-day drops in history, falling 13%.

What can investors expect now?

Alibaba agreed to a $433.5 million settlement with $BABA investors over claims it misled them about Ant Group's regulatory issues that affected its IPO and lending activities.

If you were damaged due to this situation, you can file for a payout and get your share of the settlement.

Case Type
US Securities Class Action
Case Status
Claim Submission Closed
Alleged Offence
Misleading Statements, 
Failure to Disclose, 
Omissions
Suspected Party
Directors, 
Management, 
Government Authority
Security Type
Stocks
Trade Direction
Long
Payout per Share
0.63
Filing date
11/13/2020
Plaintiffs
Laura Ciccarello; Salem Gharsalli; Dineshchandra Makadia; Yan Tongbiao
Attorneys
Beijing Hao Junbo Law Firm (Beijing, ), Bronstein, Gewirtz & Grossman, LLC (New York, NY), Glancy Prongay & Murray LLP (Los Angeles, CA), Pomerantz LLP (New York, NY), The Law Offices of Frank R. Cruz (Los Angeles, CA)
Defendants
Daniel Zhang; Maggie Wu
Judge
George B. Daniels
Administrator
A.B. Data Ltd
Settlement agreement date
2024-10-25
Court hearing date
03/27/2025
Exclusion deadline
03/06/2025
Objection deadline
03/06/2025
Attorney fee
$131,549,999
Class wide damages
$2,174,200,000
Trades matching type
FIFO

Frequently Asked Questions

Who is eligible for this settlement?

All persons who purchased or otherwise acquired the publicly traded securities of Alibaba, during the period from November 13, 2019, through December 23, 2020, inclusive.

Do you have to sell securities to be eligible?

No, if you have purchased securities within the class period, you are eligible to participate. You can participate in the settlement and retain (or sell) your securities.

How long does the payout process take?

The entire process usually takes 4 to 9 months after the claim deadline. But the exact timing depends on the court and settlement administration.

How much will my payment be?

The final payout amount depends on your specific trades and the number of investors participating in the settlement.

If 100% of investors file their claims - the average payout will be $0.63 per share. Although typically only 25% of investors file claims, in this case, the average recovery will be $2.52 per share.

How to get your payout?

If you're eligible, you can file your claim directly from this case page by clicking the "Collect Payout" button.

More than 100 companies are currently paying out settlements. Connect your brokerage account to automatically check which ones you may have missed — or file manually for this case.

What is 11th.com?

11th.com is an investor recovery company that helps investors track and collect securities class action settlements. We will:

1. Prepare documents for your payout.

2. Audit the claim and make sure you get the maximum possible payout.

3. File a claim with the settlement administration.

4. Correspond with the settlement administration to resolve emerging issues.

5. Deliver payout directly to your brokerage account.

There is no upfront cost, but we will deduct 20% of the recovered amount as a commission for our services.