East Group faces class-action lawsuit over past misrepresentation

East Group Co., Ltd. has announced its receipt of a civil ruling from the Guangzhou Intermediate People's Court, signaling the commencement of a common representative action lawsuit. The case involves ten individual investors, including Lin and Lin, who are suing the company for securities misrepresentation liability, with a total claim amount of 234,991 yuan. The court has deemed the case suitable for common representative action proceedings.

The lawsuit stems from alleged information disclosure violations in the company's 2017 annual report, as determined by the China Securities Regulatory Commission's administrative penalty decision. The misrepresentation period is identified as March 15, 2018, with the disclosure date on May 12, 2023. Investors who purchased the company's shares between these dates and held them after May 11, 2023, are eligible to join the lawsuit, subject to specific conditions regarding causal links between misrepresentation and damages.

East Group is currently in the position of defendant. Given that the case will proceed under common representative action and is yet to be heard, the final amount of liability remains uncertain. The company stated it cannot yet assess the impact on its current or future period profits but will continue to monitor developments and fulfill its information disclosure obligations.