On October 26th, Alibaba Group (NYSE: BABA, 09988.HK) announced that it had agreed to pay $433.5 million (approximately 3.087 billion yuan) 

to settle a consolidated shareholder class action lawsuit. In the announcement, Alibaba stated that the settlement does not constitute 

an admission or acknowledgment that the claims in the lawsuit have any merit, and the company denies any allegations of wrongdoing, liability, 

misconduct, or damages. The settlement is reached solely to avoid the costs and disruptions associated with further litigation.

Flaws in the U.S. Class Action System

Under the U.S. Securities Exchange Act, plaintiffs filing a class action lawsuit must meet five conditions when proving the company's 

actual controllers, which include material misstatements, concealment of information; elements of fraud; actual occurrence of securities transactions; 

reliance element; and causal relationship of losses. Generally, most securities class action cases are settled before going to court through settlements

 and other means. If the parties involved do not offer a settlement, the class action will proceed to the trial stage. Securities class actions are essentially 

designed to protect the interests of small and medium shareholders. At the same time, they can monitor and correct securities fraud, financial falsification of securities, and other such behaviors.

Compared to private litigation, class actions can reduce the high costs and risks associated with private litigation rights protection. 

The class action system has also been recognized by Congress, which has enacted several legislative measures that have a significant impact on

 class actions to better promote the implementation of the class action system. However, there are certain flaws in the U.S. stock market's securities 

class action system. After the settlement and compensation process is completed, investors need to follow the process to 

fill in forms and submit relevant proof, then go through a long waiting period.

Once your information is confirmed to be correct, you can receive the compensation check. However, some investors have reported

 that after receiving the check, they have missed the time to cash it, and repeated applications have wasted a lot of time and energy.