Overview

A class action lawsuit has been filed against Xiao-I Corporation (“Xiao-I” or the “Company”) (NASDAQ: AIXI) and certain of the Company’s former and current senior executive officers alleging violations of the federal securities laws.  The Xiao-I class action lawsuit is brought on behalf of all persons and entities who purchased or otherwise acquired: (a) Xiao-I American depository shares (“ADSs”) pursuant and/or traceable to the Offering Documents (defined below) issued in connection with the Company’s initial public offering conducted on or about March 9, 2023 (the “IPO” or “Offering”); and/or (b) Xiao-I securities between March 9, 2023 and July 12, 2024, both dates inclusive (the “Class Period”).  Investors have until December 16, 2024, to seek appointment as lead plaintiff in the Xiao-I class action lawsuit.

Xiao-I, through its subsidiaries, operates as a global artificial intelligence (“AI”) company.  The Company is incorporated in the Cayman Islands and headquartered in the People’s Republic of China (“China”).  As a holding company with no material operations of its own, Xiao-I conducts most of its operations through its subsidiary Shanghai Xiao-I Robot Technology Co., Ltd. (“Shanghai Xiao-I”), which comprises the Company’s AI business.  According to Xiao-I, Shanghai Xiao-I has become a leading AI company by building on its wide technology commercialization, brand recognition, and culture of innovation in China.  Leading up to and following the IPO, Xiao-I consistently represented that Shanghai Xiao-I’s purported industry-leading AI technologies and robust research and development (“R&D”) resources distinguished the Company from its competitors.

Under Xiao-I and its subsidiaries’ organizational structure, the Company transfers cash and other assets between itself and Shanghai Xiao-I through various intermediaries.  The Company’s ability to do so, however, is limited as a result of certain of its Chinese shareholders’ non-compliance with applicable foreign exchange rules promulgated by China’s State Administration of Foreign Exchange (‘SAFE’), particularly the “Circular on Issues Concerning Foreign Exchange Administration over the Overseas Investment and Financing and Roundtrip Investment by Domestic Residents via Special Purpose Vehicles” (“Circular 37”).  Circular 37 imposes certain registration requirements on Chinese residents that contribute domestic assets or interests to offshore companies, known as special purpose vehicles (SPVs), as well as on foreign investment enterprises established by way of round-tripping (“Circular 37 Registration”).

The Xiao-I class action lawsuit alleges that Defendants, throughout the Class Period, made false and misleading statements about Xiao-I’s business, operations, and prospects.  Specifically, the Offering Documents and Defendants failed to disclose or misrepresented the following: (1) they downplayed the risks Xiao-I faced due to some Chinese shareholders’ non-compliance with Circular 37 Registration, which affected the Company’s ability to use Offering proceeds as planned; (2) Xiao-I did not follow generally accepted accounting principles (GAAP) when preparing its financial statements; (3) Defendants overstated their efforts to fix material weaknesses in the Company’s financial controls; (4) Xiao-I incurred significant R&D expenses to compete in the AI industry; (5) they minimized the negative impact of those expenses on the Company’s business and financial performance; (6) Xiao-I overstated its AI capabilities, R&D resources, and competitiveness in the market; (7) as a result, there was a strong likelihood that Xiao-I would fail to meet NASDAQ’s Minimum Bid Price Requirement; and (8) consequently, the Offering Documents and Defendants’ public statements were materially false and misleading, omitting key required information.

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If you purchased or otherwise (a) Xiao-I ADSs pursuant and/or traceable to the Offering Documents issued in connection with the Company’s initial public offering conducted on or about March 9, 2023; and/or (b) Xiao-I securities between March 9, 2023 and July 12, 2024, both dates inclusive and you wish to serve as lead plaintiff in this lawsuit, we encourage you to submit your information to DiCello Levitt LLP via the form on this page. 

You can also contact DiCello Levitt partner Brian O’Mara by calling (888) 287-9005 or at [email protected]. 

The deadline to apply to the Court to serve as a lead plaintiff in the Xiao-I class action lawsuit is December 16, 2024.