NEW YORK--(BUSINESS WIRE)--Attorney Advertising--Bronstein, Gewirtz & Grossman, LLC notifies investors that a class action lawsuit has been filed against Cloopen Group Holding Limited ("Cloopen " or the "Company") (NYSE: RAAS) and certain of its officers, on behalf of shareholders who (a) purchased or otherwise acquired Cloopen American Depositary Shares ("ADSs") pursuant and/or traceable to the registration statement and prospectus (collectively, the "Registration Statement") issued in connection with the Company's February 2021 initial public offering (the "IPO"); and/or (b) purchased or otherwise acquired Cloopen securities during the Class Period. Such investors are encouraged to join this case by visiting the firm’s site: www.bgandg.com/raas.
This class action seeks to recover damages against Defendants for alleged violations of the federal securities laws under the Securities Exchange Act of 1933 and the Securities Exchange Act of 1934.
The Complaint alleges that the Registration Statement for the IPO was negligently prepared and, as a result, contained materially false and misleading statements of fact and failed to disclose facts required to be disclosed therein under the rules and regulations governing its preparation. Specifically, the Registration Statement: (2) led Cloopen ADS purchasers to believe that the Company's much-touted growth strategy, which relied upon cross-selling, up-selling, optimizing existing solutions, and developing new features, was effective. Indeed, as portrayed in the Registration Statement, Cloopen appeared to be retaining and even expanding its customer base, as well as maintaining its key sales metrics such as dollar-based net retention rate, which reflected its ability to increase existing customer revenue. In truth, Cloopen's growth strategy was not working, and its existing customers were abandoning the Company. Unbeknownst to investors, Cloopen's dollar based net retention rate had plummeted during the fourth quarter of 2020 ("4Q 2020"); (2) failed to disclose that an increasing number of its customers were refusing to pay, forcing the Company to record massive increases in its accounts receivables and allowance for doubtful accounts; and (iii) also failed to disclose that Cloopen was weighted down by massive liabilities related to the fair value of certain recently granted warrants.
The Complaint further alleges that Cloopen's most senior officers continued to make materially false and misleading statements to the market and failed to reveal the true extent of Cloopen's troubles. In the March 26, 2021 earnings announcement and investor conference call, Cloopen's senior executives continued to misrepresent the Company's expansion strategy, again failing to acknowledge that the strategy was failing, and its existing customer base was deteriorating. A class action lawsuit has already been filed. If you wish to review a copy of the Complaint you can visit the firm’s site: www.bgandg.com/raas or you may contact Peretz Bronstein, Esq. or his Investor Relations Analyst, Yael Nathanson of Bronstein, Gewirtz & Grossman, LLC at 212-697-6484. If you suffered a loss in Cloopen you have until February 8, 2022, to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as a lead plaintiff.
Bronstein, Gewirtz & Grossman, LLC is a corporate litigation boutique. Our primary expertise is the aggressive pursuit of litigation claims on behalf of our clients. In addition to representing institutions and other investor plaintiffs in class action security litigation, the firm’s expertise includes general corporate and commercial litigation, as well as securities arbitration. Attorney advertising. Prior results do not guarantee similar outcomes.