Pomerantz law firm has filed a lawsuit against the manufacturer of ASIC, Ebang International Holdings Inc, for misrepresentation.
May 3, 2021 | AtoZ Markets – Law firm, Pomerantz LLP, has announced a class action lawsuit against Ebang International Holdings Inc. The complaint is filed in the United States District Court for the District of New Jersey under number 21-cv-09859.
Also, the company’s lawyers are calling on other investors who have become victims of Ebang to join the class action and sue in this case. Applications against the ASIC manufacturer can be filed until June 7, 2021.
Pomerantz sues Ebang for lying and misleading
As explained in Pomerantz, Ebang International Holdings Inc. the company posted false information about how things were going. In particular, distorted information concerns:
- proceeds from Ebang’s public offerings, which were directed to low-yield long-term bonds to the underwriter rather than used to develop the Company’s business;
- Ebang sales volumes – the company deliberately overestimated this figure, including through the sale of defective devices;
- Ebang’s attempts to go public on the Hong Kong stock exchange, which failed due to allegations of embezzlement of investor funds and overpriced sales;
- the alleged cryptocurrency exchange Ebang – the company bought a ready-made platform.
“On April 6, 2021, prior to the market opening, Hindenburg Research released a report that, among other things, claimed that Ebang was channeling the proceeds from its IPO last year to“ a series of opaque deals with insiders and dubious counterparties.”
According to the report, Ebang raised $21 million in November 2020, stating that the proceeds would go “mainly for development,” and instead the funds were used to pay off loans to related parties to a relative of Ebang CEO Dong Hu,” the official release said.
The report also notes that previous attempts by Ebang to go public on the Hong Kong exchange have failed due to widespread media coverage of the sales inflation scheme with Yindou, a Chinese peer-to-peer online lending platform that defrauded 20,000 retail investors in 2018.
On the news, Ebang’s share price fell $0.82, or about 13%, to close at $5.53 per share on April 6, 2021, due to unusually high trading volume.
Crypto startups distort information about the state of affairs for the sake of profit
Last year, the US Securities Commission (SEC) filed a lawsuit against the Boon.Tech ICO for distorting information about the work of the platform, as well as fraud on the part of the organizers of the project.
“Pavithran and Boon.Tech have made false and misleading claims, including claiming that Boon Coins are stable and safe coins because the Boon.Tech platform eliminates the volatility inherent in digital asset markets through the use of Boon Coins proprietary hedging technology against the US dollar. In fact, Boon.Tech did not have such a patented technology,” the document says.
Think we missed something? Let us know in the comment section below.