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GDS.US
id: 1224

GDS Holdings (GDS) Investor Settlement

Late claims are being considered for compensation, subject to approval.
C.D. California
Court
2:23-cv-04900
Case number
07/13/2020
Class period Start
04/03/2023
Class period End
01/13/2025
Claim deadline

GDS Holdings reached an agreement with $GDS investors to settle claims related to the CEO's undisclosed pre-paid forward sale contracts.


Case Details:

On April 4, 2023, GDS revealed that CEO William Wei Huang had entered into pre-paid forward sale contracts, which the company had not previously disclosed.
  • GDS also stated that if Huang's ownership drops below 5%, it could alter the company’s share structure by converting Class B shares to Class A shares, thus ending the dual-class structure.
  • This change might lead to early loan repayments, contractual issues, and regulatory problems.
On this news, $GDS fell by 3.99% on April 4, 2023.

Based on all these events, GDS was accused of the following points:
  • The CEO engaged in undisclosed pre-paid forward sale contract transactions.
  • If his ownership fell below 5%, it would trigger a change of control with potentially disastrous consequences for the company.
GDS reached an agreement with $GDS investors to settle claims related to the CEO's undisclosed pre-paid forward sale contracts.
Case Status
Accepting Late Claims
Alleged Offence
Mismanagement, 
Misleading Statements, 
Omissions
Suspected Party
Directors, 
Management
Security Type
Depository Securities (ADS, ADR, GDR)
Trade Direction
Long
Payout per Share
0.06
Filing date
06/21/2023
Plaintiffs
Larry Bergmann
Attorneys
The Rosen Law Firm, P.A. (Los Angeles, CA), The Schall Law Firm (Los Angeles, CA)
Defendants
William Wei Huang, Daniel Newman
Judge
Hon. John A. Kronstadt
Administrator
Strategic Claims Services
Settlement agreement date
2024-07-28
Court hearing date
02/10/2025
Exclusion deadline
01/06/2025
Objection deadline
01/06/2025
Attorney fee
$955,000
Trades matching type
FIFO
+$3,000,000
Cash Settlement Amount

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GDS Holdings Ltd

GDS Holdings Limited, together with its subsidiaries, develops and operates data centers in the People's Republic of China. The company offers colocation services comprising critical facilities spa...

    Ticker
    GDS.US
    ISIN
    US36165L1089
    Sector
    Technology
    Industry
    Information Technology Services
    Country
    USA
    Address
    Building C, Sunland International, Shanghai, China, 200137