Tarena International, Inc.
|Company Name||Tarena International, Inc.|
|Class Period||August 16, 2016 to November 01, 2019|
|Lead Plaintiff Motion Deadline||August 23, 2021|
On April 30, 2019, Tarena revealed that it could not timely file its fiscal 2018 annual report due to an ongoing “review of certain issues identified during the course of the audit of the registrant’s financial statements for the year ended December 31, 2018, including issues related to the registrant's revenue recognition.”
On this news, Tarena’s American Depository Shares (“ADSs”) price fell 1.2%, to close at $5.02 per ADS on May 1, 2019, thereby damaging investors.
On May 17, 2019, the Company disclosed that it was notified Tarena was not in compliance with NASDAQ listing rules due to the failure to timely file its 2018 annual report.
On this news, Tarena’s ADSs fell 4.8%, to close at $3.73 per ADS on May 20, 2019, thereby damaging investors.
On July 24, 2019, Tarena disclosed that it expected that fiscal 2017 and prior periods “may need to be restated and should not be relied upon, pending the completion of the Independent Audit Committee Review.”
On this news, Tarena’s ADSs fell 4.7%, to close at $1.63 per ADS on July 25, 2019, thereby damaging investors.
Finally, on November 1, 2019, Tarena announced the results of its investigation, including a list of revenue inaccuracies for fiscal years 2014 through 2018, expense inaccuracies and irregularities, and undisclosed related party transactions. Tarena further disclosed that it “anticipates that the total amount of revenue misstatement between fiscal years 2014 through 2018 to be less than RMB900 million, representing approximately 11.5% of the total revenue previously reported by the Company for such period.”
On this news, Tarena’s ADSs dropped 9.4%, to open on November 4, 2019, the next trading day, at $0.76, thereby damaging investors further.
The complaint filed alleges that throughout the Class Period, 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) certain employees were interfering with external audits of Tarena's financial statements for certain periods; (2) Tarena suffered from revenue and expense inaccuracies; (3) Tarena engaged in business transactions with organizations owned, invested in or controlled by Tarena employees or their family members, which in some instances were not properly disclosed by Tarena; (4) as a result of the foregoing, Tarena's financial statements from 2014 through the end of Class Period were not accurate; and (5) 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.
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