Reid Collins Files Amended and Supplemental Complaint in Renren Derivative Litigation adding Softbank and Sofi
NEW YORK–(BUSINESS WIRE)–#renn–Reid Collins, a national plaintiff’s trial firm announced today that it has filed an Amended and Supplemental Complaint in the Renren Derivative Action pending in New York State Supreme Court adding new defendants Softbank Group Capital Limited (“Softbank GCL”) (SFTBY) and Social Finance, Inc. (“SoFi”) (IPOE) as well as additional claims.
The shareholder derivative suit arises from the alleged misappropriation of a billion-dollar investment portfolio from Renren, Inc. (“Renren”)(RENN) through a sham “spin-off” involving a series of highly unusual transactions. The complaint asserts claims for, among other things, breaches of fiduciary duty in connection with the transfer of Renren’s most valuable assets, including a substantial stake in SoFi, to a private company, Oak Pacific Investments (“OPI”) owned and controlled by Renren’s CEO Joseph Chen and affiliates of SoftBank GCL, among other Renren insiders. Chen and SoftBank GCL’s affiliates stood on all sides of these transactions as major investors and/or directors in Renren, OPI, and SoFi itself.
Reid Collins’ co-founder Bill Reid explained that the amended pleadings adding the new defendants and additional claims for injunctive relief against existing defendant OPI are warranted because of the Defendants’ continued alleged self-dealing and knowing participation in fraudulent conveyances. The new claims allege that despite pending litigation centered on SoFi shares wrongfully taken from Renren, Chen and SoftBank GCL intentionally orchestrated fraudulent conveyances involving 17 million of those SoFi shares to further enrich themselves and to frustrate Plaintiffs’ future judgment collection efforts. Chen and SoftBank GCL affiliates held seats on the boards of directors for both OPI and SoFi. As a result of the conflicts-laden, fraudulent conveyances, SoFi was effectively able to buy back its shares at less than half of fair market value. SoFi recently announced a proposed business combination with a SPAC that valued SoFi at approximately $6.6 billion.
In May 2020, on behalf of Renren, the Reid Collins team defeated attempts to dismiss this derivative action. The Court entered a 71-page order denying all of the motions filed by insiders and others involved in the transactions at issue.
The complaint seeks more than $500 million in damages.
The case is captioned In re Renren, Inc. Derivative Litigation (Heng Ren Silk Road Inv. LLC and Oasis Inv. II Master Fund Ltd., derivatively on behalf of Renren, Inc. v. Chen, et al.,) No. 653294/2018 (N.Y. Sup. Ct.)
About Reid Collins
Reid Collins & Tsai LLP is one of the nation’s leading plaintiffs’ trial firms, litigating complex business disputes and achieving billions of dollars in settlements and judgments for its clients. Its team is comprised of accomplished trial lawyers, including former federal prosecutors, who have extensive experience prosecuting financial fraud and corporate malfeasance cases, bankruptcy and insolvency related litigation, professional liability claims, and cross-border disputes. The firm represents fund managers, investor groups, trustees, receivers, liquidators, international banks, companies, and individuals in federal and state courts across the country.
For more information visit www.reidcollins.com
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