NEW YORK--(BUSINESS WIRE)--Faruqi & Faruqi, LLP, a leading national securities law firm, reminds investors in Gridsum Holding, Inc. (“Gridsum” or the “Company”) (NASDAQ:GSUM) of the June 25, 2018 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
If you invested in Gridsum stock or options between April 27, 2017 and April 20, 2018 and would like to discuss your legal rights, click here: www.faruqilaw.com/GSUM. There is no cost or obligation to you.
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The lawsuit has been filed in the U.S. District Court for the Southern District of New York on behalf of all those who purchased Gridsum securities between April 27, 2017 and April 20, 2018 (the “Class Period”). The case, Xu v. Gridsum Holding Inc. et al, No. 1:18-cv-03655 was filed on April 25, 2018 and has been assigned to Judge Edgardo Ramos.
The lawsuit focuses on whether the Company and its executives violated federal securities laws by making materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, the company made false and/or misleading statements and/or failed to disclose that: (i) Gridsum lacked effective internal control over financial reporting; (ii) consequently, Gridsum’s financial statements were inaccurate and misleading, and did not fairly present, in all material respects, the financial condition and results of operations of the Company; and (iii) as a result of the foregoing, Gridsum’s public statements were materially false and misleading at all relevant times.
Specifically, on April 23, 2018, Gridsum issued a press release entitled “Gridsum Reports Suspension of Audit Report on Financial Statements,” announcing that its “audit report for the Company’s financial statements for the year ended December 31, 2016 should no longer be relied upon.” According to the press release, Gridsum’s auditor identified certain issues in conducting its audit of Gridsum’s financial results for the year ended December 31, 2017. Those issues related to “certain revenue recognition, cash flow, cost, expense items, and their underlying documentation which [the auditor] had previously raised” with Gridsum.
After the announcement, Gridsum’s share price fell from $7.29 per share on April 20, 2018, to a closing price of $6.12 on April 23, 2018—a $1.17 or a 16.04% drop.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Gridsum’s conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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