It is common for A-share listed companies to issue penalties for violations by the Securities and Futures Commission, but it is rare to encounter individual investor class actions. However, Foshan Lighting (000541.SZ), which was once praised as “cash cow†by the A-share market, is facing a huge litigation whirlpool due to false statements. The number and amount of claims may set a new record in the A-share market. .
According to Wang Zhibin, a lawyer from Shanghai Jiesai Law Firm who convened investor rights protection on March 9, according to the previous decision of the CSRC, the number of investors who meet the claim conditions will exceed 1,000, and the amount of the claim may exceed 100 million yuan. "This data is already a conservative estimate. My personal rights protection team recently received more than one hundred inquiries from investors, and more than 600 faxes and emails were required to calculate the loss." Wang Zhibin said.
As of now, Foshan Lighting has not issued any announcements about the upcoming litigation wave. As of press time, no reply has been received from Foshan Lighting on related issues.
a lawsuit triggered by a paper ticket
On March 7, 2013, Foshan Lighting announced that it had received an administrative penalty decision issued by the Guangdong Regulatory Bureau of the China Securities Regulatory Commission on March 6. The parties involved in the company’s violation of laws and regulations, including the company’s own chairman, Zhong Xincai The six executives within the company made administrative penalties.
The violations of laws and regulations include many items that Foshan Lighting did not disclose according to law or truthfully and timely in the two years from 2010 to 2011. They are: 40 million bank loan guarantees provided by the company's controlling subsidiaries for its affiliates in 2010. Up to 80 million affiliated transactions of 9 affiliated companies, the company and its related parties jointly invested, increased capital and acquired equity from related parties; in 2011, the company's controlling subsidiaries borrowed 25 million yuan from related parties, and the company was associated with 9 in the current year. The company has as many as more than 83 million related transactions.
Wang Zhibin said that according to the above-mentioned administrative punishment decision, many company executives, including Zhong Xincai, have violated laws, regulations and even the company's articles of association. These acts directly led to Foshan Lighting's false statement and caused Foshan Lighting to suffer civil claims. . Therefore, Foshan Lighting’s current shareholder’s losses due to civil claims should be compensated by responsible executives.
According to the introduction, July 15, 2010 is the implementation date of the above-mentioned false statement behavior of Foshan Lighting, and July 6, 2012 is the disclosure day of Foshan Lighting's false statement behavior. In Wang Zhibin's view, the loss investors who bought Foshan Lighting from July 15th, 2010 to July 5th, 2012 and did not sell all of them during this period all have the claim conditions, and the effective claim time span is relatively large.
Litigation or accidental injury to existing shareholders
It should be pointed out that with the punishment decision and the possible litigation tide, Foshan Lighting's stock price has also been falling all the way, from 6.81 yuan on the announcement day (March 7) to yesterday's closing price of 6.17 yuan, a drop of nearly 10%. This has hurt investors who still own Foshan Lighting.
“It’s not a company in Foshan Lighting. Many stocks of listed companies that have been subject to civil claims by shareholders have such a decline.†But Wang Zhibin stressed that “the stock price decline is not because of the civil claims of the shareholders, but because of the securities company’s ticket, the recent Foshan lighting The fall in the stock price was also started on the day the notice was punished, and at that time there was no claim for any stockholders."
Obviously, in addition to investors who are single-minded in defending rights, there are currently three types of investors in the market, and their mentality is different.
The first is investors who do not meet the conditions of the claim and do not hold shares again. They often feel sad and puzzled.
The second type is investors who meet the conditions of the claim but still hold shares. On the one hand, they are required to participate in rights protection. On the other hand, they are also in conflict. They are very worried that the litigation wave will further drag on the stock price.
The third type is investors who do not meet the claim conditions but also hold shares. These investors regard the litigation wave as a major negative and regard themselves as the direct victims of the bearish. "They often have misunderstandings about rights protection, and their hearts are in conflict." Wang Zhibin said.
Regarding the protection of the third type of investor rights, Wang Zhibin said that such a large-scale lawsuit may indeed be a supporting factor for the stock price decline, which may accidentally hurt the current shareholders. “Just like the police going to recover a stolen property, it is indeed possible to accidentally injure the owner of the stolen goods. However, this is necessary to maintain the dignity of the law.†However, he also said that these investors who were accidentally injured are still You can seek to protect your own interests through legal channels.
Wang Zhibin said that according to the provisions of the "Company Law" of China, if a company executive violates laws, regulations or the company's articles of association and causes losses to the company, the company has the right to demand compensation from senior executives. If the company does not recover, shareholders who hold more than 1% of the company's shares individually or in total for more than 180 consecutive days may file a lawsuit directly in court in their own name.
According to Wang Zhibin, a lawyer from Shanghai Jiesai Law Firm who convened investor rights protection on March 9, according to the previous decision of the CSRC, the number of investors who meet the claim conditions will exceed 1,000, and the amount of the claim may exceed 100 million yuan. "This data is already a conservative estimate. My personal rights protection team recently received more than one hundred inquiries from investors, and more than 600 faxes and emails were required to calculate the loss." Wang Zhibin said.
As of now, Foshan Lighting has not issued any announcements about the upcoming litigation wave. As of press time, no reply has been received from Foshan Lighting on related issues.
a lawsuit triggered by a paper ticket
On March 7, 2013, Foshan Lighting announced that it had received an administrative penalty decision issued by the Guangdong Regulatory Bureau of the China Securities Regulatory Commission on March 6. The parties involved in the company’s violation of laws and regulations, including the company’s own chairman, Zhong Xincai The six executives within the company made administrative penalties.
The violations of laws and regulations include many items that Foshan Lighting did not disclose according to law or truthfully and timely in the two years from 2010 to 2011. They are: 40 million bank loan guarantees provided by the company's controlling subsidiaries for its affiliates in 2010. Up to 80 million affiliated transactions of 9 affiliated companies, the company and its related parties jointly invested, increased capital and acquired equity from related parties; in 2011, the company's controlling subsidiaries borrowed 25 million yuan from related parties, and the company was associated with 9 in the current year. The company has as many as more than 83 million related transactions.
Wang Zhibin said that according to the above-mentioned administrative punishment decision, many company executives, including Zhong Xincai, have violated laws, regulations and even the company's articles of association. These acts directly led to Foshan Lighting's false statement and caused Foshan Lighting to suffer civil claims. . Therefore, Foshan Lighting’s current shareholder’s losses due to civil claims should be compensated by responsible executives.
According to the introduction, July 15, 2010 is the implementation date of the above-mentioned false statement behavior of Foshan Lighting, and July 6, 2012 is the disclosure day of Foshan Lighting's false statement behavior. In Wang Zhibin's view, the loss investors who bought Foshan Lighting from July 15th, 2010 to July 5th, 2012 and did not sell all of them during this period all have the claim conditions, and the effective claim time span is relatively large.
Litigation or accidental injury to existing shareholders
It should be pointed out that with the punishment decision and the possible litigation tide, Foshan Lighting's stock price has also been falling all the way, from 6.81 yuan on the announcement day (March 7) to yesterday's closing price of 6.17 yuan, a drop of nearly 10%. This has hurt investors who still own Foshan Lighting.
“It’s not a company in Foshan Lighting. Many stocks of listed companies that have been subject to civil claims by shareholders have such a decline.†But Wang Zhibin stressed that “the stock price decline is not because of the civil claims of the shareholders, but because of the securities company’s ticket, the recent Foshan lighting The fall in the stock price was also started on the day the notice was punished, and at that time there was no claim for any stockholders."
Obviously, in addition to investors who are single-minded in defending rights, there are currently three types of investors in the market, and their mentality is different.
The first is investors who do not meet the conditions of the claim and do not hold shares again. They often feel sad and puzzled.
The second type is investors who meet the conditions of the claim but still hold shares. On the one hand, they are required to participate in rights protection. On the other hand, they are also in conflict. They are very worried that the litigation wave will further drag on the stock price.
The third type is investors who do not meet the claim conditions but also hold shares. These investors regard the litigation wave as a major negative and regard themselves as the direct victims of the bearish. "They often have misunderstandings about rights protection, and their hearts are in conflict." Wang Zhibin said.
Regarding the protection of the third type of investor rights, Wang Zhibin said that such a large-scale lawsuit may indeed be a supporting factor for the stock price decline, which may accidentally hurt the current shareholders. “Just like the police going to recover a stolen property, it is indeed possible to accidentally injure the owner of the stolen goods. However, this is necessary to maintain the dignity of the law.†However, he also said that these investors who were accidentally injured are still You can seek to protect your own interests through legal channels.
Wang Zhibin said that according to the provisions of the "Company Law" of China, if a company executive violates laws, regulations or the company's articles of association and causes losses to the company, the company has the right to demand compensation from senior executives. If the company does not recover, shareholders who hold more than 1% of the company's shares individually or in total for more than 180 consecutive days may file a lawsuit directly in court in their own name.
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