NEW YORK–(BUSINESS WIRE)–Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, announces that a class action lawsuit has been filed in the United States District Court for the Eastern District of New York on behalf of investors that purchased or otherwise acquired BlueCity Holdings Limited (“BlueCity” or the “Company”) (NASDAQ: BLCT) securities pursuant and/or traceable to the offering documents issued in connection with BlueCity’s July 8, 2021 initial public offering (the “IPO”). Investors have until September 17, 2021 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
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On December 2, 2020, BlueCity issues a press release announcing financial and operating results for the third quarter and fiscal year 2020. The press release reported, among other results, that the Company’s cost of revenues had increased 41.4% year-over-year, selling and marketing expenses had increased 86.3% year-over-year, technology and development expenses had increased 49.5% year-over-year, and general and administrative expenses had increased 4,349% year-over-year.
On this news, BlueCity’s American Depositary Share (“ADS”) price fell $3.30 per ADS, or 22.84%, to close at $11.15 per ADS on December 2, 2020.
Then on March 23, 2021, BlueCity issued a press release announcing its results for the fourth quarter of 2020. Among other results, BlueCity announced revenue of $42.7 million, missing consensus estimates by $3.92 million.
On this news, BlueCity’s ADS price fell $3.25 per ADS, or 26.71%, over the following two trading sessions, to close at $8.92 per ADS on March 24, 2021.
The complaint alleges that the Company’s offering documents were negligently prepared and, as a result, contained untrue statements of material fact or omitted other facts necessary to make the statements made not misleading. Specifically, the offering documents were false or misleading and/or failed to disclose that: (1) defendants had overstated BlueCity’s business and financial prospects; (2) the Company was ill-equipped to absorb the costs of becoming a publicly traded company, including IPO- and growth-related costs; (3) as a result of the foregoing, defendants had misrepresented the Company’s capability for sustainable growth; and (4) as a result, the offering documents were materially false or misleading and/or failed to state information required to be stated therein.
If you purchased BlueCity shares pursuant and/or traceable to the IPO and suffered a loss, have information, would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Brandon Walker, Melissa Fortunato, or Marion Passmore by email at firstname.lastname@example.org, telephone at (212) 355-4648, or by filling out this contact form. There is no cost or obligation to you.
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Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York, California, and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.