Class Period: December 13, 2018 - January 15, 2020
Date Filed: Jan 22, 2020
Case Number: 1:20cv00577
Jurisdiction: New York Southern District Court
Days Left to Seek Plaintiff:
Qudian was founded in 2014 and is headquartered in Xiamen, the People’s Republic of China (“China”). Qudian provides online small consumer credit products in China, using big data-enabled technologies, including artificial intelligence and machine learning to purportedly transform the consumer finance experience. Qudian offers small credit products, such as cash credit products; merchandise credit products to finance borrowers’ direct purchase of merchandise offered on its marketplace on installment basis; and budget auto financing products. In addition, it operates a platform for loan recommendations and referrals. The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) regulatory developments in China threatened to negatively impact Qudian’s fiscal full year 2019 (“FY19”) financial results; (ii) Qudian’s business was unprepared to mitigate the risks associated with these regulatory changes; (iii) as a result, Qudian’s loan portfolio was plagued by growing delinquency rates; (iv) all of the foregoing made Qudian’s repeated assertions concerning its FY19 financial guidance unrealistic; and (v) as a result, the Company’s public statements were materially false and misleading at all relevant times. On January 16, 2020, Qudian issued a press release announcing “that the Company withdraws its fiscal 2019 guidance and will not issue guidance in the near term due to uncertainty related to the recent regulatory and operating environment.” The press release stated that “China’s online consumer finance industry was affected by several regulatory developments in the fourth quarter of 2019, including further restrictions on loan collection practices, more stringent user data privacy rules and the requirements for P2P lending platforms to orderly exit their P2P businesses,” which had “reduced the availability of funding for consumer credit and driven up delinquency rates across the industry, including the Company’s loan portfolio.” On this news, Qudian’s ADS price fell $0.84 per share, or 19.13%, to close at $3.55 per share on January 16, 2020.