Baidu, iQIYI Win Dismissal With Prejudice of Securities Class Actions

Skadden secured the dismissal of a pair of putative securities fraud class actions on behalf of China-based internet giant Baidu and iQIYI, a streaming platform in which Baidu owns a controlling stake. Each company’s shareholders brought separate suits after a short seller report accused iQIYI of various misconduct, including inflating its daily active users and certain revenue metrics and improperly accounting for a joint venture. On September 30, 2024, Judge Diane Gujarati of the U.S. District Court for the Eastern District of New York dismissed both actions with prejudice, rejecting the plaintiffs’ fraud-based and strict liability claims. Robert Fumerton, Steve Kwok and Scott Musoff led the Skadden team.