The legal action, filed in the United States District Court for the Middle District of Florida, follows a sharp 19% decline in Webull’s share price on October 7, 2026. This sell-off occurred after a report revealed a significant discrepancy between the company’s public declarations of U.S.-based operations and its actual structural, technical, and data-routing ties to China. The complaint alleges that Webull repeatedly dismissed concerns raised by the House Select Committee on the Chinese Communist Party, maintaining a narrative of U.S. autonomy in SEC filings while a congressional inquiry into its data security practices remained active for nearly two years.

Joseph E. Levi, managing partner at Levi & Korsinsky, LLP, stated that the firm is seeking to address the gap between internal knowledge and public disclosure during the class period. Investors have until December 7, 2026, to apply for lead plaintiff status. Participation does not require out-of-pocket fees, and eligibility extends to those who sold their shares at a loss as well as current holders. The firm is currently reviewing trading histories to determine potential recovery for those impacted by the alleged misstatements.