Dangdang $21 Million Securities Class Action Settlement

William C. Gendron

Editor in Chief

Published

May 4, 2026 11:03 AM

Updated

May 4, 2026

Who can file a claim?

The settlement includes all persons who held E-Commerce China Dangdang Inc. American depositary shares at any time between March 9, 2016, and Sept. 20, 2016, inclusive, and whom the company cashed out in the merger, including those who converted their ADSs to Dangdang common stock during that period.

Additional details

Both individuals and entities can be class members.
The settlement includes shareholders who held ADSs directly and those who held through a broker or other nominee.
The actual beneficial owner or a legal representative must submit the claim.
Joint owners must each sign the claim form.
Executors, administrators, guardians, conservators, custodians, trustees and legal representatives may submit claims on behalf of others if they provide proof of authority.
Each ADS represents five Dangdang Class A shares.

How much is the Dangdang payout?

The total settlement fund is $21,000,000. The amount each class member will receive depends on several factors:

The number of valid claims submitted
The number of eligible ADSs or converted Class A shares cashed out in the merger
The total recognized losses of all claimants

The settlement administrator will distribute payments on a pro rata basis according to the Tribunal-approved plan of allocation:

The estimated average recovery is approximately $0.41 per ADS before deductions. After estimated deductions of approximately $0.17 per ADS, the estimated average net recovery is approximately $0.24 per ADS or approximately $0.05 per ordinary Class A share.
Actual payments may be higher or lower depending on individual claims and the total number of valid claims.
The settlement administrator will calculate each class member's payment based on the recognized loss amount assigned to each share.
Recognized loss amounts depend on the type of security held and how it converted in the merger. The settlement administrator will calculate them using the Tribunal-approved plan of allocation, which applies different formulas depending on the security type.

For Dangdang ADSs cashed out in the merger, the recognized loss is $2.10 per ADS, calculated as the estimated fair value of $8.80 per ADS minus the merger consideration of $6.70 per ADS.
For Class A shares received in exchange for ADSs converted during the class period and cashed out in the merger, the recognized loss is $0.42 per share, calculated as the estimated fair value of $1.76 per share minus the merger consideration of $1.34 per share.
For Dangdang securities involved in a valid dissent from the merger or the Cayman Islands appraisal action, the recognized loss is $0.

The settlement administrator will set any recognized loss that calculates to a negative number to $0.
If total recognized losses exceed the net settlement fund, the settlement administrator will reduce payments on a pro rata basis.
Class members whose payment would be less than $10 will not receive a payout.

How to claim a Dangdang securities class action settlement payment

Class members may file a claim online or download, print and complete the PDF claim form and mail it to the settlement administrator. The claim deadline is Aug. 6, 2026.

Settlement administrator's mailing address: Dangdang Securities Settlement, c/o Epiq Systems Inc., P.O. Box 5916, Portland, OR 97228-5916

Proof or documentation required to submit a claim

All class members must provide the last four digits of their Social Security number or taxpayer identification number. They must also provide holding, conversion and transaction information, including:

Holdings of Dangdang ADSs as of the open of trading on March 9, 2016
Holdings of Dangdang ADSs as of the close of trading on Sept. 20, 2016
Number of ADSs tendered or canceled in exchange for merger consideration on or after Sept. 20, 2016
Number of ADSs converted to common shares during the class period
Number of common shares tendered or canceled in exchange for merger consideration on or after Sept. 20, 2016
Trade dates for all conversions, tenders and cancellations

Class members must also provide documentation supporting their holdings and transactions in Dangdang securities. Acceptable proof includes:

Broker confirmation slips
Broker account statements
Authorized statements from a broker, financial advisor or financial institution containing the transactional and holding information

Payout options

Physical check

$21 million settlement fund

The $21,000,000 settlement fund includes:

Settlement administration costs: To be determined
Attorneys' fees: Up to $7,000,000
Attorneys' expenses: Up to $1,800,000
Payments to eligible class members: Remainder of the fund

Important dates

Opt-out deadline: July 21, 2026
Deadline to file a claim: Aug. 6, 2026
Fairness hearing: Aug. 11, 2026

When is the Dangdang securities class action settlement payout date?

The settlement administrator will issue payments after it processes all claims, the Tribunal grants final approval to the settlement, the District Court confirms the award and the courts resolve any appeals.

Why did this class action settlement happen?

The class action lawsuit alleged Dangdang and related defendants breached fiduciary duties and made false or misleading statements regarding their plans to relist the company after the merger, the fairness of the $6.70-per-ADS merger price and the independence of the special committee that evaluated the merger. The plaintiffs claimed these misrepresentations artificially depressed the price of Dangdang ADSs and allowed defendants to acquire the company at an unfair price.

The defendants denied all allegations of wrongdoing but agreed to settle to avoid the costs, risks and delays of continued litigation.