Lizhi Inc

In January, 2020, Lizhi conducted its IPO, issuing 4.1 million ADSs priced at $11.00 per ADS. 

On April 20, 2020, Lizhi admitted that before the IPO, as early as “late 2019,” the COVID-19 pandemic was already negatively impacting its business.

Since the IPO, Lizhi shares are trading below $4 per share, or 63% below the IPO pricce. 

The complaint alleges that Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors that: (1) at the time of the IPO, the coronavirus was already ravaging China, the home base, principal market, and significant hub for Lizhi, its employees, and its customers; (2) the complications associated with the coronavirus were already negatively affecting Lizhi's business, as employees and customers contracted the virus, lost employment, or otherwise experienced difficulty in generating, publishing, and monetizing the content critical to Lizhi's platform; (3) even prior to the IPO, Lizhi employees and customers complained of, and to, Lizhi, which harmed the Company's reputation and financial condition and prospects; and (4) as a result, Defendants' statements about its business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.