Tuya, Inc. Stock News: Robbins LLP is investigating Tuya, Inc. (TUYA) on behalf of shareholders


SAN DIEGO–(BUSINESS WIRE)–The class: Law firm in shareholder law Robbins LLP is investigating Tuya, Inc. (NYSE: TUYA) and its officers and directors to determine whether they breached their fiduciary duties and violated securities law in connection with the company’s initial public offering (“IPO”). company in March 2021. Tuya has developed and offers a purpose-built “Internet of Things” (“IoT”) cloud platform that offers a suite of offerings, including Platform as a Service, or PaaS, and software as a service, or SaaS, to businesses and developers. The Company’s proprietary products and services enable so-called “smart” devices, such as household items and Internet-connected devices, to communicate and interact with end users and online information and services.

If you would like more information about our investigation into the misconduct of Tuya, Inc., click here.

What this case is about: According to the class action lawsuit filed against Tuya, Inc., the offering documents in support of the company’s IPO contained misrepresentations of material facts.

Prior to the IPO, Tuya claimed to be experiencing phenomenal growth. Tuya claimed to be the “largest IoT PaaS company in the global IoT PaaS market by volume of powered smart devices” and said its “business ha[d] scaled rapidly in recent periods,” growing revenue 70% year-over-year to $179.9 million in 2020.

Tuya held its IPO in March 2021, selling over 45 million ADSs at $21 per ADS. However, unbeknownst to investors, a significant portion of Tuya’s China-based customers engaged in widespread illicit activities to deceptively promote and sell their products on e-commerce marketplaces such as Amazon.com. Many of Tuya’s most prominent customers engaged in the systematic practice of writing fake reviews and paying for positive reviews, in direct violation of Amazon.com’s seller policies and practices. Manipulation of ratings by a large portion of Tuya’s customer base posed a significant undisclosed risk that Amazon.com would end or limit the sale of products containing Tuya’s technology on its platform, which would have a significant negative impact on the company’s financial results. Additionally, on March 1, 2021, more than two weeks before the IPO, a data security organization, Safety Detectives, had recovered a database that exposed 13 million records of organized fake scams related to more than 200,000 Amazon account profiles, many of which involved Tuya’s customers.

On May 11, 2021, it was reported that “several major Chinese sellers disappeared from Amazon”. The article noted that the “suspended accounts have contributed over $1 billion in gross merchandise value (GMV) to Amazon.” Then, on July 9, 2021, it was reported that Amazon had “closed 340 online stores of one of its largest Chinese retailers in the first half of this year” as it cracks down on paid reviews and d Other Violations of Amazon’s Terms of Service. Over the next few weeks, Amazon banned hundreds of Chinese brands on thousands of seller accounts, many of whom were Tuya customers. Amazon said these sellers knowingly, repeatedly, and materially violated Amazon’s Seller Policies, particularly those regarding review abuse.

Finally, Tuya announced its financial results for the second quarter of 2021 and a disappointing outlook for the third quarter of 2021. By August 2022, Tuya ADS had fallen below $2 per ADS, or 90% below the price at which they were been sold to the investor. Public.

Next steps: If you acquired shares of Tuya, Inc. pursuant to the company’s IPO, you have legal options. Contact Robbins LLP for more information.

All representation is done on a contingent fee basis. Shareholders do not pay any fees or expenses.

Contact us for more information:

Aaron Dumas

(800) 350-6003

[email protected]

Shareholder Information Form

About Robbins LLP: A recognized leader in shareholder rights litigation, the attorneys and staff of Robbins LLP are dedicated to helping shareholders recoup losses, improving corporate governance structures and holding corporate executives responsible for their wrongdoings since 2002. To be notified if a class action lawsuit against Tuya, Inc. settles or to receive free alerts when corporate executives commit wrongdoing, sign up for Watch Inventory today.

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