GigaCloud Technology Inc.
The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Central District of California on behalf of those who acquired GigaCloud Technology Inc. (“GigaCloud” or the “Company”) (NASDAQ: GCT) securities during the period from August 18, 2022 through September 27, 2023, inclusive (the “Class Period”). Investors have until December 4, 2023 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
In August 2022, GigaCloud conducted its initial public offering (“IPO”), selling 3,381,000 Class A ordinary shares at $12.25 per share for net proceeds of approximately $34.2 million.
On September 28, 2023, before the market opened, Culper Research published a report alleging “numerous glaring flaws” in GigaCloud’s public reporting. For example, the Report stated that while GigaCloud “claims to run 14 U.S. warehouses,” the Company “discloses just 73 employees in the entire U.S., implying just 5 employees per warehouse.” The Report also alleged that “GigaCloud’s marketing materials utilize photoshopped stock photos to portray itself as a highly efficient, growing operation,” but that Culper Research’s investigators visited some of the Company’s warehouses and discovered little activity. Further, the Report alleges that Culper Research uncovered “numerous entities which are neither named subsidiaries nor disclosed as GCT related parties” whose conduct at the very least “suggests undisclosed related party issues.”
On this news, the price of GigaCloud shares declined by $1.78 per share, or approximately 18.8%, from $9.47 per share to close at $7.69 on September 28, 2023.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose that: (i) GigaCloud’s business is a fraction of what it publicly claims, as evidenced by staffing and activity levels at its warehouses; (ii) the Company overstated its last-mile operations; (iii) the Company engaged in undisclosed related party transactions; (iv), as a result, the Company’s financial results were overstated; and (v) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
In August 2022, GigaCloud conducted its initial public offering (“IPO”), selling 3,381,000 Class A ordinary shares at $12.25 per share for net proceeds of approximately $34.2 million.
On September 28, 2023, before the market opened, Culper Research published a report alleging “numerous glaring flaws” in GigaCloud’s public reporting. For example, the Report stated that while GigaCloud “claims to run 14 U.S. warehouses,” the Company “discloses just 73 employees in the entire U.S., implying just 5 employees per warehouse.” The Report also alleged that “GigaCloud’s marketing materials utilize photoshopped stock photos to portray itself as a highly efficient, growing operation,” but that Culper Research’s investigators visited some of the Company’s warehouses and discovered little activity. Further, the Report alleges that Culper Research uncovered “numerous entities which are neither named subsidiaries nor disclosed as GCT related parties” whose conduct at the very least “suggests undisclosed related party issues.”
On this news, the price of GigaCloud shares declined by $1.78 per share, or approximately 18.8%, from $9.47 per share to close at $7.69 on September 28, 2023.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose that: (i) GigaCloud’s business is a fraction of what it publicly claims, as evidenced by staffing and activity levels at its warehouses; (ii) the Company overstated its last-mile operations; (iii) the Company engaged in undisclosed related party transactions; (iv), as a result, the Company’s financial results were overstated; and (v) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.