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UPDATE 2-Alibaba must face renewed lawsuit over IPO -U.S. appeals court

UPDATE 2-Alibaba must face renewed lawsuit over IPO -U.S. appeals court
From Reuters - December 6, 2017

NEW YORK (Reuters) - A U.S. appeals court on Tuesday revived a lawsuit accusing Alibaba Group Holding Ltd (BABA.N) of defrauding shareholders by concealing a regulatory warning about counterfeiters that the Chinese online retailer had received shortly before going public.

The 2nd U.S. Circuit Court of Appeals in Manhattan ruled 3-0 that a lower court judge erred in dismissing claims by holders of Alibabas American Depositary Shares and ADS call options against Alibaba, Executive Chairman Jack Ma and others.

Alibaba said it was disappointedby the decision but that the ruling did not determine that Alibaba had violated U.S. securities law.

We believe our behavior was entirely appropriate, and we intend to defend ourselves vigorously as this litigation progresses, it said in a statement.

The appeals court in the Tuesday opinion said the plaintiffs adequately alleged that Alibaba intended to defraud them but did not rule on the merits of the case.

Alibaba has long faced accusations that its websites are a haven for counterfeiters, including of luxury goods.

Shareholders accused Alibaba of concealing a meeting on July 16, 2014, two months before its $25 billion initial public offering, in which Chinas powerful State Administration for Industry and Commerce threatened huge fines if Alibaba failed to suppress counterfeiting.

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