Be accused of rendering financial performance Orchid Pavilion Collection potential

June 7 This year, China's largest foreign trade E-commerce company Pavilion set in the United States officially listed on the New York Stock Exchange, the 2013 U.S. market, the first listed Chinese companies. However, the Orchid pavilion potential, including investors may not have thought, only 2 months later, the Orchid Pavilion is due to the decline in performance suffered 3 U.S. law firms launched a class action. Relevant litigation documents have been submitted to local courts in the United States. Information from foreign media shows that the 3 U.S. law firms that have launched a lawsuit against the pavilion are accusing the Orchid pavilion and its executives of violating the Securities and Exchange Act of 1934. According to the plaintiff, in the U.S. local time June 6 The first public release to August 19 this time, the pavilion set out a series of substantive errors and misleading information statements, rendering the company's financial performance and prospects. The defendant wrongly stated or failed to disclose the fact that the second-quarter revenue growth had fallen sharply, and that the cost growth exceeded the revenue growth and the consequential consequences. To this end, 3 law firms will represent the United States and international investors who bought the Orchid Pavilion stock during the period to make claims. It is understood that the Orchid Pavilion set in August 19 after the release of the report, the company's second-quarter revenue of 72.2 million U.S. dollars, in addition to special items per share earnings for 0.05 U.S. dollars, less than market expectations. The company's revenue grew by 52.6% in the period, while operating costs grew by 57%. Earlier, the pavilion's prospectus to the Securities and Exchange Commission showed that revenue rose by nearly 100% in the first quarter of this year, but fell to 52.6% in the second quarter, seemingly less than investors expected. In the company's performance forecasts, third-quarter revenue year-on-year growth is lower, between 33% to 37%. In the IPO roadshow, the Orchid Pavilion set a target of 64% revenue growth this year. According to the media, the current situation, the company only in the fourth quarter to achieve 90% year-on-year growth to achieve this goal. The shares plunged 39.91% per cent after the announcement on the previous day of the pavilion on August 20, local time. Yesterday's closing, the share price has been from the highest point in mid-August to 23.38 U.S. dollars, to 10.09 U.S. dollars. Related news to improve the level of integrity of the capital market "sharp weapon" class action is a unique procedure in the United States and other countries. Simply put, if a large number of plaintiffs are suing for similar claims in the same case, if the plaintiffs have a "representative" or a representative body to win, the court's decision will apply to all plaintiffs. Yesterday, Zhangyuanzhong, a beijing-based law firm, said that the 3 law firms that launched a lawsuit against the Orchid Pavilion had claimed to be on the market for all U.S. and international investors who bought the company's shares by mid-August. Once the other party wins, the Orchid Pavilion will suffer very serious losses and consequences. "Why the U.S. market is less fake is because counterfeiters once discovered, they will pay a high price, or even bankruptcy." "Zhangyuanzhong lawyers believe that the Orchid Pavilion collection potential must cite a strong rebuttal to prove that the original performance forecast when the accounting data for real, and based on the real data of the speculationis reasonable. After that, what happened to the new events and changes in the market, resulting in its performance than the original forecast. Liu Junhai, a professor at Renmin University Law School, admits that the case once again sounded a wake-up call to Chinese companies. The U.S. securities law on the interests of investors more fully and fully, if the listed companies in the performance forecast, did not set reasonable qualification conditions, will pay for their "Dahua". To this end, Chinese enterprises, especially those in the United States listed in the stock, must learn to "do as the Romans do", not only to fully fulfill the issuer's disclosure obligations, integrity listed, but also to operate in good faith. Previously, our country has no precedent for group litigation. In the 55th of China's Civil Procedure Law, amended and promulgated in August 2012, the article of the Public interest litigation has been added: "To pollute the environment, infringe upon the legitimate rights and interests of many consumers and other harm to the public interests of the acts, the law of the organs and related organizations can sue the people's Court. "Zhangyuanzhong lawyers believe that the above public interest litigation provisions and collective action still have conceptual differences, in the judicial practice, there is no precedent for class action in our country." Therefore, the legal profession has also been calling for the introduction of collective action as soon as possible, which will be a "sharp weapon" to promote our capital market to improve the level of integrity.