UPDATE: China Life: US Court Dismisses Class-Action Lawsuit
By Daniel at 4 September, 2008, 3:33 pm
UPDATE: China Life: US Court Dismisses Class-Action Lawsuit
Last Update: 9/4/2008 8:19:58 AM
(Adds amount of irregularities found by audit.)
HONG KONG (Dow Jones)–China Life Insurance Co. (LFC) said Thursday a U.S. court
dismissed a class-action lawsuit brought against it by U.S. investors, which
alleged the company had concealed financial fraud and a government probe of that
fraud from investors during its US$3.46 billion listing in 2003.
The lawsuit was filed in March 2004 after China’s National Audit Office published
a report on its Web site that said an investigation of China Life’s predecessor
firm found several cases of irregular or illegal behavior involving a total of
CNY5.4 billion (US$652.4 million).
The audit covered the period to 2002, before the company was restructured for its
IPO during 2003.
The suit sought class-action status on behalf of all those who bought China
Life’s shares between Dec. 22, 2003 and Feb. 3, 2004, the period from the IPO
until the audit office’s report was released.
It said the company wouldn’t have been able to sell its shares at such a high
price if the audit and the financial irregularities had been disclosed to
investors. After news of the audit was disclosed, China Life’s shares fell
sharply.
China Life said in a statement Thursday that a federal U.S. court in New York
dismissed the claims, finding that “there is no merit to any of these claims.”
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