NEW YORK, NY / ACCESSWIRE / December 7, 2021 / Bernstein Liebhard, a nationally acclaimed investor rights law firm, reminds investors of the deadline to file a lead plaintiff motion no later than January 18, 2022 in a securities class action lawsuit that has been filed on behalf of investors who purchased or acquired the American Depositary Shares ("ADSs") of Zhangmen Education, Inc. ("Zhangmen" or the "Company") (NYSE:ZME) in connection with Zhangmen's June 8, 2021 initial public offering. The lawsuit was filed in the United States District Court for the Southern District of New York and alleges violations of Sections 11 and 15 of the Securities Act of 1933.
If you purchased or acquired Zhangmen ADSs in connection with the IPO, and/or would like to discuss your legal rights and options please visit Zhangmen Education, Inc. Shareholder Class Action Lawsuit or contact Joe Seidman toll free at (877) 779-1414 or [email protected].
On or about June 8, 2021, Zhangmen conducted its IPO, offering 3,623,000 ADSs (excluding the underwriters' option to purchase an additional 543,450 ADSs) at a price of $11.50 per ADS. Thereafter, Zhangmen sold 4,166,450 ADSs in the IPO (including the full exercise of the underwriters' over-allotment option) raising proceeds of approximately $47,900,000.
According to the complaint, Defendants made false and/or misleading statements and failed to disclose that (a) PRC authorities were in the process of implementing sweeping new regulatory reforms on the private education industry in China including, among others, prohibitions on: (i) profit-making by private education companies, (ii) engaging in core-curriculum tutoring on weekends and vacations, and (iii) capital-raising by companies like Zhangmen; and (b) the known risks, events, and uncertainties noted in the Registration Statement were reasonably likely to have a material adverse effect on Zhangmen's business.
On July 23, 2021 - less than two months after the IPO - China unveiled a sweeping overhaul of its education sector, banning companies that teach school curriculum from making profits, raising capital or going public. These drastic measures effectively ended any potential growth in the for-profit tutoring sector in China. For example, a Reuters report titled "China bars for-profit tutoring in core school subjects" stated that the "move threatens to decimate China's $120 billion private tutoring industry and triggered a heavy selloff in shares of tutoring firms traded in Hong Kong and New York."
On July 26, 2021, Zhangmen issued a release providing an update on the new PRC policies and provided a further update on August 25, 2021on similar policies implemented by the Shanghai government and the implications for the Company's business.
Finally, on November 19, 2021, Zhangmen announced that its auditor, Deloitte Touche Tohmatsu Certified Public Accountants LLP, had voluntarily resigned.
As of the filing of the Complaint, Zhangmen ADSs trade at less than $2 per ADSs, more than 80% below the IPO price.
If you wish to serve as lead plaintiff, you must move the Court no later than January 18, 2022. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. Your ability to share in any recovery doesn't require that you serve as lead plaintiff. If you choose to take no action, you may remain an absent class member.
If you purchased or acquired Zhangmen ADSs, and/or would like to discuss your legal rights and options please visit https://www.bernlieb.com/cases/zhangmeneducationinc-zme-shareholder-lawsuit-class-action-fraud-stock-460/ or contact Joe Seidman toll free at (877) 779-1414 or [email protected].
Since 1993, Bernstein Liebhard LLP has recovered over $3.5 billion for its clients. In addition to representing individual investors, the Firm has been retained by some of the largest public and private pension funds in the country to monitor their assets and pursue litigation on their behalf. As a result of its success litigating hundreds of lawsuits and class actions, the Firm has been named to The National Law Journal's "Plaintiffs' Hot List" thirteen times and listed in The Legal 500 for ten consecutive years.
ATTORNEY ADVERTISING. © 2021 Bernstein Liebhard LLP. The law firm responsible for this advertisement is Bernstein Liebhard LLP, 10 East 40th Street, New York, New York 10016, (212) 779-1414. The lawyer responsible for this advertisement in the State of Connecticut is Michael S. Bigin. Prior results do not guarantee or predict a similar outcome with respect to any future matter.
Contact Information:
Joe Seidman
Bernstein Liebhard LLP
https://www.bernlieb.com
(877) 779-1414
[email protected]
SOURCE: Bernstein Liebhard LLP