Investors of AIXI Urged to Lead Class Action Against Xiao-I Over Fraud Claims

AIXI Investors Encouraged to Take Action Against Xiao-I Corporation for Alleged Fraud

Investors holding shares of Xiao-I Corporation (NASDAQ: AIXI) are presented with a significant opportunity to lead a class action lawsuit concerning alleged securities fraud. The Law Offices of Frank R. Cruz have announced the initiation of this action due to substantial financial losses incurred by shareholders during the defined class period: March 9, 2023, to July 12, 2024. The deadline for potential lead plaintiffs is December 16, 2024.

The case is rooted in accusations that the company's management failed to transparently disclose critical information to investors throughout the class period. Notably, it is alleged that the management downplayed several crucial risks associated with compliance issues stemming from Circular 37 Registration related to certain of its Chinese shareholders. This negligence notably affected the company’s ability to utilize the proceeds from its offerings for their intended business purposes.

Furthermore, Xiao-I Corporation has been accused of preparing its financial statements in violation of generally accepted accounting principles (GAAP). Claims indicate that the company overstated its remedial efforts to address significant weaknesses in its financial controls, and that substantial research and development (R&D) expenses were necessary in order for Xiao-I to remain competitive within the rapidly evolving artificial intelligence (AI) industry.

The high costs tied to R&D activities were reportedly downplayed, despite their substantial adverse impact on the company’s overall financial health and business performance. This misrepresentation of expenses carries broader implications, indicating that Xiao-I might not have the robust capabilities and resources in AI that it projected to investors. Consequently, this might lead to the company's inability to meet NASDAQ's Minimum Bid Price Requirement, raising questions about its future viability as a publicly traded entity.

The announcement by The Law Offices of Frank R. Cruz urges all shareholders who experienced loss during the class period to consider joining this legal initiative. Currently, no action is required from shareholders; they can choose to either retain their preferred counsel, remain passive, or participate in the class action as absent members.

For those interested in further details, or to address any questions related to the proposed lawsuit, Frank R. Cruz can be contacted directly at their office in Century City, California, or through their official website. The law firm emphasizes the importance of including personal contact information in any email inquiries to facilitate effective communication.

This case exemplifies a critical juncture for Xiao-I investors, demonstrating how collective action can be a potent tool in seeking accountability and potential recovery for losses linked to alleged misconduct. As the legal processes unfold, ongoing updates will be shared, and stakeholders are encouraged to stay informed via the law firm's communications channels.

In summary, AIXI investors have a pivotal role to play in this class action lawsuit against Xiao-I Corporation, potentially influencing the future direction of the company and seeking redress for their financial losses.