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SHAREHOLDER ALERT: Pomerantz Law Firm Reminds Shareholders with Losses on their Investment in Ruhnn Holding Limited of Class Action Lawsuit and Upcoming Deadline – RUHN  

/EIN News/ -- NEW YORK, Nov. 11, 2019 (GLOBE NEWSWIRE) -- Pomerantz LLP announces that a class action lawsuit has been filed against Ruhnn Holding Limited (“Ruhnn” or the “Company”) (NASDAQ: RUHN) and certain of its officers.   The class action, filed in United States District Court, for the Eastern District of New York, and docketed under 19-cv-06162, is on behalf of a class consisting of investors who purchased or otherwise acquired Ruhnn American Depositary Shares (“ADSs”) pursuant and/or traceable to the Company’s April 3, 2019 initial public offering (the “IPO” or “Offering”), seeking to pursue remedies under the Securities Act of 1933 (the “Securities Act”).

If you are a shareholder who purchased Ruhnn securities ADSs pursuant and/or traceable to the Company’s April 3, 2019 initial public offering, you have until December 6, 2019, to ask the Court to appoint you as Lead Plaintiff for the class.  A copy of the Complaint can be obtained at   To discuss this action, contact Robert S. Willoughby at or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and number of shares purchased. 

[Click here for information about joining the class action]

Ruhnn describes itself as China’s largest key opinion leader (“KOL”) facilitator and the largest KOL facilitator in China’s e-commerce market.  So-called KOLs are essentially social media influencers, i.e., individuals who create content on social media platforms such as Facebook, YouTube, Tik Tok, and Instagram with the hope of garnering a large public following.  As a purported KOL facilitator, Ruhnn contracts with social media influencers who are paid to promote, market, and advertise products and services to their fans and followers.  Ruhnn claims to recruit, train, and manage KOLs and provide them with analytical support.  The Company describes such activities as “incubating” KOLs.  Ruhnn’s KOLs primarily market women’s apparel, cosmetics, shoes, handbags, and other fashion products on social media platforms popular in China, such as Miaopai, Tik Tok, and Kuaishou.

Ruhnn’s KOLs provide marketing services both to Ruhnn-owned and -operated brands and stores and to Ruhnn’s third-party customers.  The Company describes sales of products through Ruhnn’s own stores as the Company’s product sales business, which Ruhnn also refers to as its “full-service model.”  The majority of these online stores are located or hosted on third-party ecommerce platforms and are operated and marketed in the name of Ruhnn’s KOLs.  As of December 31, 2018, Ruhnn purportedly owned and operated ninety-one online stores.  Ruhnn earns revenue from these product sales by taking a percentage of the sales price at the time the product is sold.  The Company’s full-service model is its largest and most important operating segment, accounting for over 88% of Ruhnn’s total net revenues for the nine months ended December 31, 2018.

Ruhnn also derives revenue from its service business, which Ruhnn refers to as its “platform model.”  Ruhnn launched its platform model in 2017 to market its KOLs and KOL services to third parties, such as brands, retailers, designers, and manufacturers.  As of December 31, 2018, Ruhnn claimed to have over 500 customers using its platform services.  Ruhnn earns fees for these services under a variety of arrangements.

On March 6, 2019, Ruhnn filed with the Securities and Exchange Commission a registration statement on Form F-1 for the IPO, which, after several amendments, was declared effective on April 2, 2019 (the Form F-1, together with all amendments, is referred to herein as the “Registration Statement”).  One day later, on April 3, 2019, the Company filed a prospectus for the IPO on Form 424B4 (the “Prospectus”), which incorporated and formed part of the Registration Statement.  The Registration Statement was used to sell to the investing public approximately 10 million Ruhnn ADSs, representing 50 million Ruhnn Class A ordinary shares, at $12.50 per share.  Defendants generated $125 million in gross offering proceeds from their sale of Ruhnn ADSs in the IPO.

The Complaint alleges that the Registration Statement contained false and/or misleading statements and/or failed to disclose that: (i) at the time of the IPO, the number of Ruhnn's online stores had declined by nearly 40%; (ii) at the time of the IPO, the number of Ruhnn's full-service Key Opinion Leaders had declined by nearly 44%; (iii) as a result, the Company's net revenues derived from its full-service segment had declined by 46% on a sequential basis; and (iv) as a result, defendants' statements about Ruhnn's business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times. When the true details entered the market, the lawsuit claims that investors suffered damages.

On June 14, 2019, Ruhnn reported its fiscal year and fourth quarter 2019 financial results.  These results were for the quarter prior to the quarter in which defendants had conducted the IPO.  In the fiscal 2019 press release, Ruhnn reported that, as of March 31, 2019, the Company only had fifty-six stores in operation, which indicated that the Company had closed nearly 40% of the ninety-one stores defendants reported operating in the Registration Statement.  The press release also disclosed that Ruhnn’s product sales had fallen 46% sequentially and grown by a meager 1.4% year over year.  At the same time, Ruhnn’s reported results in its service platform business were entirely eclipsed by the meager growth in the full-service product sales business.  Revenue from platform services was $7.5 million and $22 million for the quarter and fiscal year, respectively, versus $28 million and $140 million in product sales for the quarter and year.  Gross margin across the Company’s revenue streams had also declined eighty basis points year over year, reflecting the Company’s failure to approach profitability, as its most important operating segment, its full-service segment, had suffered a significant contraction prior to the IPO.

Since the IPO, and as a result of the disclosure of material adverse facts omitted from Ruhnn’s Registration Statement, Ruhnn ADSs have fallen substantially below their IPO price, damaging Plaintiff and Class members.

The Pomerantz Firm, with offices in New York, Chicago, Florida, and Los Angeles, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See

Robert S. Willoughby
Pomerantz LLP