Expectations and Misconceptions of Retail Investors Regarding Class Actions Under the New Securities Law, and Lawyers’ Recommendations

Article 171 of the Securities Law stipulates that during an investigation by the securities regulatory authority under the State Council into a unit or individual suspected of violating securities laws, if the investigated party submits a written application undertaking—within a time limit recognized by the regulatory authority—to rectify the alleged unlawful conduct, compensate relevant investors for losses, and eliminate damage or adverse effects, the regulatory authority may decide to suspend the investigation. If the investigated party fulfills its undertaking, the regulatory authority may decide to terminate the investigation; if it fails to fulfill the undertaking or other circumstances prescribed by the State Council arise, the investigation shall be resumed. Specific measures shall be formulated by the State Council. If a listed company is under investigation for suspected violations—even without formal penalties—yet sufficient evidence has already been gathered by the China Securities Regulatory Commission (CSRC), conditions for initiating a class action lawsuit may already be met (the traditional ‘precondition’—i.e., prior administrative punishment—is not mandated by law, and judicial interpretations on this point are already contested; courts could readily establish a dedicated channel for investor protection institutions). Once an investor protection institution meets the requisite conditions to initiate a class action, the court issues a public notice, the securities depository and clearing institution registers eligible investors on its behalf, professional institutions calculate investors’ losses while deducting systemic risk factors, and investors confirm their participation—thus completing the class action process. Concurrently, the CSRC’s investigation into the offending company may be terminated. Such scenarios likely present ample room for application. Of course, the above outlines a purely speculative procedural pathway—but one that is not devoid of practical feasibility. Provided no laws are violated, all parties stand to benefit: this approach is viable, and we recommend that the CSRC and investor protection institutions seriously consider it. Under such a mechanism, the listed company reforms its practices and survives; existing shareholders’ interests are safeguarded; the CSRC conserves substantial investigative resources; and investors receive rightful compensation (those who opt out and pursue individual litigation would likely recover no more—and at far greater cost in time and effort). All involved institutions thus make significant contributions, and the pilot program for class actions achieves success. An alternative, extreme scenario arises if the listed company refuses full cooperation, rendering class action indispensable to appease public outrage. In such cases, considerations like the number of shareholders or market capitalization become irrelevant. Instead, defendants in the class action may include not only the listed company itself but also its directors, supervisors, and senior management; securities firms; accounting firms; law firms; appraisal agencies; and credit rating agencies—all potentially held jointly and severally liable. The ultimate consequence may extend beyond delisting to bankruptcy liquidation of the listed company, with professionals across intermediary institutions facing financial ruin. Landmark cases like these would enter legal history. Class actions, after all, do not discriminate—and under the new Securities Law, every stakeholder must proceed with utmost caution and trepidation. Listed companies risk delisting or bankruptcy; directors, supervisors, and senior management, as well as intermediaries, face joint and several liability. Hence, future enterprises contemplating listing must think thrice before proceeding; individuals considering director, supervisor, or senior management roles at listed or pre-IPO companies must likewise deliberate carefully; and providers of legal, auditing, appraisal, or credit rating services to listed companies must exercise equal prudence. The once-easy path of collecting fees without commensurate responsibility may no longer exist: even absent class actions, once a listed company lacks funds to compensate investors, the ever-present threat of joint and several liability will impose immense pressure on directors, supervisors, senior management, and intermediaries. V. Recommendations from Securities Litigation Lawyers First, transitional and grace periods should be explicitly provided in judicial interpretations concerning special securities class actions and in detailed rules issued by investor protection institutions. Although class actions are civil proceedings, they carry strong punitive implications—potentially more severe for listed companies than criminal liability. Prior to promulgation of the Securities Law, related judicial interpretations, and institutional rules, listed companies had no forewarning of such regulatory developments and thus no ability to anticipate potential legal consequences. Whether newly enacted rules should apply retroactively to all eligible claims warrants careful deliberation and balancing. Every detail implicates enormous interests—impacting the survival of listed companies, their shareholders, directors, supervisors, senior management, and intermediary institutions. Extreme caution is therefore essential—not only to ensure compliance with statutory law, but also to uphold legal principles and accommodate psychological factors and common sense.

Chemours Sues DuPont; A Subsidiary Sues Its Parent Company—Uncovering a Series of Scandals!

Court documents allege that DuPont ‘orchestrated the spin-off of its Performance Chemicals Unit to form a new company named Chemours, as part of a deliberate plan to mitigate its historical environmental liabilities.’ These documents were filed in Delaware state court and were originally intended to remain confidential. However, when Chemours’ attorneys failed to submit a publicly redacted version by the court’s deadline, the Associated Press petitioned the Delaware Supreme Court to unseal the documents—without any modifications. The documents state that, in 2010, DuPont commissioned ‘a blue-ribbon panel composed of company managers, scientists, and engineers to devise solutions to this widely acknowledged problem.’ The company could have spent $60 million to completely halt emissions—or $20 million to reduce them by 70%. ‘But even the mildest recommended solution was too costly for DuPont,’ the court documents state. Instead, after installing a $2.3 million system that eliminated one wastewater stream, DuPont chose to shut down the system at the end of 2013—coinciding precisely with its announcement of plans to spin off Chemours, internally codenamed ‘Project Beta.’ Project Beta focused specifically on DuPont’s Performance Chemicals Unit—the very division responsible for ‘many of DuPont’s environmental liabilities,’ including those involving PFAS compounds such as GenX. The documents state: ‘Since this problem could be conveniently transferred to Chemours, why spend money solving it?’ And indeed, that is exactly what happened. This year, Chemours, North Carolina’s Department of Environmental Quality, and Cape Fear River Watch entered into a consent order imposing a $12 million penalty on Chemours. The documents note that the consent order requires Chemours to adopt ‘the same technology DuPont previously refused to install.’ When DuPont established Chemours as a subsidiary in spring 2015, it knew that its Fayetteville plant had been discharging PFAS into the Cape Fear River for over 30 years. Yet, in private corporate discussions, DuPont assured Chemours that cleaning up the Fayetteville site’s environmental contamination would cost no more than $2 million. That figure is now estimated at $200 million—not including potential fines from class-action lawsuits. Moreover, Chemours faces hundreds of millions of dollars in cleanup costs for multiple sites in New Jersey. DuPont also ‘shockingly’ underestimated the cost of resolving approximately 3,500 lawsuits. These suits were filed by residents near DuPont’s Washington Works plant in Ohio/West Virginia, whose drinking water had been contaminated with PFAS from plant wastewater discharges. ‘These are serious cases. Hundreds involve cancer patients; others suffer from other severe illnesses.’ DuPont engaged Deloitte to analyze potential litigation costs; Deloitte estimated DuPont would prevail in 68% of the cases. ‘The remaining cases could be resolved relatively inexpensively’—at a total cost of $128 million, including defense attorneys’ fees.

Robbins LLP Informs Investors of Chemours Class Action Lawsuit

Oct 9, 2026

Robbins LLP announced a class action lawsuit against The Chemours Company, alleging overstated demand for Opteon products led to unreliable fiscal 2026 guidance. Following reduced EBITDA guidance, Chemours' stock price dropped significantly on August 5, 2026.

The National Law Review

2026-04-17

Chemours' Fayetteville Works Earns Gold-Level WHC Conservation Certification for Environmental Excellence

2026-04-18

Chemours Company Receives Average 'Hold' Recommendation from Brokerages

2026-04-21

Chemours' West Virginia Forest Partnership Delivers Measurable Climate and Community Impact After Five Years

2026-04-21

Chemours to Release Q1 2026 Results May 5, Host Webcast

2026-04-22

Activists Demand No-Mining Pledge Near Okefenokee Swamp from Chemours