Coupang Shareholder Fraud Lawsuit Dismissed by US District Judge

US District Judge dismisses shareholder fraud lawsuit against e-commerce giant Coupang. The lawsuit was related to the company's financial reporting, but the judge ruled that the plaintiffs failed to provide sufficient evidence of wrongdoing. Coupang operates in the Korean retail market and offers various products and services through mobile apps and websites.

A U.S. District Judge has dismissed a lawsuit against Coupang, the South Korean e-commerce giant often referred to as the "Amazon of South Korea," over allegations of defrauding shareholders during and after its 2021 initial public offering (IPO). The ruling, delivered by Judge Vernon Broderick in Manhattan, found that the plaintiffs, led by several New York City public pension funds, did not provide sufficient evidence to support their claims of fraudulent activities [^NUMBER].

The lawsuit accused Coupang of concealing unsafe working conditions at its warehouses, manipulating search results, and coercing suppliers to boost prices on rival platforms for products it automatically price-matched. Coupang's share price fell by more than half within a year of the March 2021 IPO, as multiple investigations by South Korea's Fair Trade Commission and a fire at a large fulfillment center came to light [^NUMBER].

In his 83-page decision, Judge Broderick stated that many of Coupang's statements regarding working conditions were too broad or "aspirational" to be misleading, while statements about its relationships with suppliers were either inspecific, true, or "puffery." He also noted that the plaintiffs failed to plead "with particularity" the circumstances of Coupang's alleged price manipulation, and that the company had disclosed its employees were writing reviews [^NUMBER].

The judge dismissed all claims against Coupang and its underwriters, including Goldman Sachs, JPMorgan Chase, and Allen & Co., with prejudice, meaning the lawsuit cannot be refiled. Lawyers for the shareholders and Coupang did not immediately respond to requests for comment [^NUMBER].

Coupang, founded in 2010 by South Korean billionaire Bom Kim, raised $4.6 billion in its IPO, the largest by a foreign company on Wall Street since Chinese e-commerce company Alibaba went public in September 2014 [^NUMBER]. The case is Teachers' Retirement System of the City of New York et al v Coupang Inc et al, U.S. District Court, Southern District of New York, No. 22-7309.