According to the law firm press release, the lawsuit alleges defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that: (1) certain areas in Kandi’s previously issued financial statements for the years ended December 31, 2015 and 2014, and the first three quarters for the year ended December 31, 2016 required adjustment; (2) in turn, Kandi lacked effective controls over financial reporting; and (3) as a result, defendants’ statements about Kandi’s business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.
On November 14, 2016, Kandi announced the abrupt resignation of its CFO. On this news, shares of Kandi fell $0.40 per share or over 10% from its previous closing price to close at $3.50 per share on November 14, 2016, damaging investors. On March 14, 2017, Kandi revealed that its previously issued financial statements for the years ended December 31, 2015 and 2014, and the first three quarters for the year ended December 31, 2016 will need to be restated. On this news shares of Kandi fell $0.30 per share or approximately 7% to close at $4.05 per share on March 14, 2017, further damaging investors.
This case was voluntarily dismissed on May 30, 2017. A related case continues under Docket 17-CV-01944 in the Southern District of New York.
On May 29, 2018, the Court issued an Order consolidating cases and appointing Lead Plaintiffs and Counsel. Lead Plaintiffs filed a consolidated amended Complaint on August 31. The Court issued an Order consolidating cases on November 15. Defendants filed a Motion to Dismiss the consolidated amended Complaint on December 14. On September 30, 2019, the Court issued an Order granting Defendants' Motion to Dismiss. The Court amended the Dismissal Order on October 4.