On Tuesday, September 15, 2026, Law360 reported that a federal judge in New Jersey has ruled that the former chief executive of Future FinTech Group must face investor claims accusing him of manipulating the company’s stock price following its failed pivot from a fruit juice business to blockchain-based e-commerce.
U.S. District Judge Julien Xavier Neals denied a bid by Future FinTech, former CEO Shanchun Huang and former Chief Financial Officer Ming Yi to dismiss the shareholder suit, finding that investor Scott Present had adequately alleged Huang manipulated trading in the company’s shares to keep them above Nasdaq’s minimum $1 listing price.
The ruling closely tracks a related enforcement action brought by the Securities and Exchange Commission, which similarly accuses Huang of artificially propping up Future FinTech’s stock. Both cases allege that shares of the company, which trades under the ticker FTFT, surged as high as $11.29 during the period of alleged manipulation before crashing to under 30 cents once the scheme came to light.
According to the court’s opinion, Huang opened a trading account at HSBC and used it to buy more than 667,000 Future FinTech shares while selling upwards of 575,000 shares across roughly 390 separate transactions over the course of a year. He then loaned the proceeds from those sales back to the company, the opinion states. HSBC later closed Huang’s account, formally severing its banking relationship with him, and liquidated his remaining shares.
Judge Neals wrote that the trading history alone was “more than enough” to establish that Huang made the transactions at issue. He also pointed to detailed allegations in the complaint about Huang’s trading patterns on specific days as sufficient to support an inference that Huang intended to mislead the market and inflate the stock price. The judge added that Huang’s alleged failure to disclose his ownership stake in Future FinTech, as securities laws require, further supported an inference of fraudulent intent.
The court also found that the complaint adequately alleged material misrepresentations and omissions by Huang, Yi and the company itself, noting that the defendants had spoken publicly about Huang’s business acumen, the company’s stock price, its legal exposure and the accuracy of its financial reports. Because they chose to address those topics favorably, Judge Neals said, they had an obligation to disclose the fuller, less favorable picture as well.
As for Yi, the judge concluded the complaint sufficiently alleged that the former CFO acted with the required state of mind, given his background as a certified public accountant and experienced financial executive, his knowledge that Huang was under SEC investigation, and his own compensation’s dependence on the company’s stock price. Judge Neals found Yi was, at minimum, reckless in not investigating whether Huang had manipulated the stock.
The opinion further held that the complaint adequately pled loss causation, citing allegations that Future FinTech’s share price fell more than 20% the day after the SEC filed its suit against Huang and publicly disclosed his trading conduct.
Jacob Frenkel of Dickinson Wright PLLC, who represents the defendants, said in a statement that his clients disagreed with the ruling and remained confident they would prevail on the merits. He characterized the private lawsuit as duplicative of a “factually incorrect” SEC case pursued without independent investigation, calling it an added burden on federal courts and defendants alike.
Source: Law360
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