On August 15, 2019, 9F conducted its IPO, selling over 8 million ADS shares at $9.50 per share. It is alleged in this complaint that the Registration Statement failed to disclose that 9F was in a dispute with PICC, its insurance partner, which resulted in multiple legal actions in China. Additionally, the Registration Statement failed to disclose that PICC was delaying, challenging, and otherwise failing to pay service fees to 9F according to the parties’ agreement, which rendered the collectability of services fees owed to 9F by PICC doubtful and as risk of non-payment.
On June 15, 2020, 9F stated that it could not timely file its annual report with the SEC as a result of its dispute with PICC. The notice indicated that the 9F’s dispute with PICC had predated its IPO and was expected to have a significant impact on the results of its operations in 2018 and 2019. Additionally, on June 17, 2020 a press release was issued, which further reaffirmed that 9F’s dispute with PICC predated the IPO and had caused material damage to 9F’s business, operations, and financial results. By September 24, 2020, 9F traded at $0.80 at per share, a decline from its IPO price of more than 90%.
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