Alibaba agrees to $433.5m settlement in US monopolistic lawsuit

• Published On: 27 October 2024 at 18:43

Alibaba has agreed to pay $433.5 million to settle a US class-action lawsuit alleging monopolistic practices, despite the company's denial of any wrongdoing.

It stated that the decision to settle is intended to avoid the costs and disruptions associated with ongoing litigation, according to Reuters.

The proposed settlement, which must be approved by U.S. District Judge George Daniels, addresses a lawsuit filed in 2020 accusing Alibaba of violating antitrust laws by requiring merchants to use only one distribution platform.

The settlement compensates investors in Alibaba's American depositary shares for losses incurred between November 13, 2019, and December 23, 2020, when the company's misleading statements caused a decline in stock price.

In court papers, lawyers for the plaintiffs described the proposed deal as "an exceptional result," noting that it far exceeded the median recovery in securities class actions where investor losses exceeded $10 billion.

If the Alibaba investors had pursued the litigation further, they could have sought a maximum damages award of $11.63 billion.