Park Ha Biological Technology (PHH) IPO Pump-and-Dump Case

Attorneys review the case details to decide whether to proceed with a class action.

S.D. New York

Court

1:26-cv-06421

Case number

12/27/2024

Class period Start

07/08/2025

Class period End

09/28/2026

Lead Plaintiff motion deadline

$PHH stockholder filed a claim against Park Ha Biological Technology, its CEO, CFO, a director, its auditor, and its IPO underwriters for structuring an IPO with an extremely low public float that enabled a coordinated pump-and-dump scheme, and for failing to disclose that its stock was being manipulated through fraudulent social media promotions.
After PHH's stock, driven by impersonators posing as financial advisors who touted a fabricated L'Oréal partnership rumor in WhatsApp groups, spiked from its $4.00 IPO price to an all-time high of $41.49, it collapsed approximately 93% in a single trading session, closing at $2.99 per share.
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Case Details:

On December 27, 2024, Park Ha Biological Technology, a Chinese skincare and cosmetics franchise company, completed its IPO, offering just 1,200,000 of its 26,200,000 outstanding shares to the public, less than 5% of total ownership, while insiders retained the rest. Investors allege this low-float structure was intentionally designed to make the stock vulnerable to manipulation, and that PHH's risk disclosures described only a generic, hypothetical risk of volatility rather than disclosing the actual, ongoing manipulation scheme targeting its stock.

Then, beginning around June 18, 2025, impersonators using stolen identities of financial professionals began promoting PHH in WhatsApp groups, telling victims that institutional investors were accumulating shares ahead of an unannounced partnership with L'Oréal that would drive a 200-300% price increase. Fueled by this coordinated promotion, PHH's stock rose from roughly $4 to a close of $41.01 on July 7, 2025, giving the company a market capitalization exceeding $1 billion despite having only around 40 franchise stores and no material business developments to justify the valuation. 

The following day, July 8, 2025, the stock collapsed 93% in a single session, closing at $2.99 per share and wiping out nearly $1 billion in market value. PHH never acknowledged the manipulation in any subsequent filing or press release.

Based on these events, $PHH investors filed a claim against Park Ha Biological Technology, alleging the company:
It structured its IPO with an artificially low public float that enabled stock manipulation.
It failed to disclose the known risk that its stock was the target of a coordinated pump-and-dump promotion scheme.
It caused investor losses when the manipulated price collapsed once the artificial buying pressure ended.
Investors argue Park Ha Biological Technology misled the market about its vulnerability to stock manipulation, causing losses when the artificially inflated price collapsed.

Case Type

US Securities Class Action

Case Status

Attorney Investigation

Alleged Offence

Fraud,

Failure to Disclose,

Price manipulation

Suspected Party

Directors,

Management

Security Type

Stocks

Trade Direction

Long

Shock Event Date

07/08/2025

Filing date

07/28/2026

Lead Plaintiff Deadline

09/28/2026