Qutoutiao Sees Investor Suit Over In-App Advertising Reinstated

A securities suit against Qutoutiao Inc. was improperly dismissed for not pleading sufficient detail about the Chinese news aggregator’s alleged advertising-related misstatements accompanying its initial and secondary public offerings, the Second Circuit ruled Monday.

The lower court—the US District Court for the Southern District of New York—held the investors to a heightened pleading standard for fraud, but they had framed their claims for registration statement and prospectus misstatements “in the classic language of negligence and strict liability,” the appeals court said in an unsigned, unpublished opinion.

• The investors alleged in their proposed class action that Qutoutiao misstated that it had ...