VNet Investors Advance Class Suit Over Co-Founder’s Loan Default

US investors in VNet Group Inc. can proceed with proposed class claims that the data center company concealed a controlling shareholder’s loan default and the default’s potential effect, a federal court ruled.

The investors adequately alleged false of misleading statements in Securities and Exchange Commission filings and an earnings call, Judge Dale E. Ho said Monday for the US District Court for the Southern District of New York. They also showed the necessary level of intent for securities fraud, Ho said.

The suit on behalf of holders of American depositary shares in the Chinese company alleges co-founder Josh Sheng Chen, ...