Skadden secured a favorable settlement for China-based iDreamSky Technologies Limited in a putative class action arising from its $116 million initial public offering of American depository shares.
The plaintiffs filed several lawsuits in state and federal court, alleging that the defendants misled investors about the anticipated timing of a new mobile game release. Skadden successfully consolidated the lawsuits before Judge J. Paul Oetken of the U.S. District Court for the Southern District of New York, including defeating the plaintiffs’ attempt to remand the state court actions under provisions of the Securities Litigation Uniform Standards Act that are currently under review by the U.S. Supreme Court.
Judge Oetken declined to dismiss the consolidated case based on the plaintiffs’ unproven allegations. The parties agreed to mediation, which resulted in a settlement of less than 15 percent of the plaintiffs claimed damages. Judge Oetken preliminarily approved the proposed settlement on December 15.