Investors sue Nasdaq, Facebook over IPO
REUTERS - Nasdaq OMX Group Inc has been sued by an investor who claimed the exchange operator was negligent in handling orders for Facebook Inc shares following its initial public offering, causing losses for investors.
In addition, a different civil lawsuit was filed against Facebook, Mark Zuckerberg, IPO underwriters Morgan Stanley & Co and others alleging violations of securities laws.
Phillip Goldberg, a Maryland resident, is seeking class-action status on behalf of all investors who lost money because Nasdaq delayed or otherwise mishandled their buy, sell or cancellation orders for Facebook stock on May 18, the day the social networking company went public.
A technical glitch delayed Facebook's market debut by roughly half an hour, and later delayed order confirmations.
Nasdaq Chief Executive Robert Greifeld told investors at his company's annual meeting on Tuesday that "clearly we had mistakes in the Facebook listing," but more than 570 million shares were processed on the first day.
Goldberg filed his lawsuit on Tuesday in the U.S. District Court in Manhattan.
Separately, investor Darryl Lazar filed a proposed class-action lawsuit in a California state court, alleging that Facebook's registration and prospectus were materially false, according to a statement from plaintiff law firm Glancy Binkow & Goldberg.
Reuters reported late on Monday that the consumer Internet analyst at lead underwriter Morgan Stanley cut his revenue forecasts for Facebook in the days before the offering, information that may not have reached many investors before the stock was listed.
Representatives from Facebook and Morgan Stanley could not immediately be reached for comment on the securities class-action.
Facebook shares sank on Monday and Tuesday -- their second and third days of trading -- to end at $31, more than 18 percent below the initial public offering price of $38.
The Nasdaq case is Goldberg v. Nasdaq OMX Group Inc et al, U.S. District Court, Southern District of New York, No. 12-04054.
(Reporting By Jonathan Stempel in New York; Editing by Gary Hill and Muralikumar Anantharaman)
- Tweet this
- Share this
- Digg this
- EXCLUSIVE - Apple iPhone 6 screen snag leaves supply chain scrambling
- U.S. strikes have slowed Iraq militants but not weakened them - Pentagon
- Arvind Subramanian likely to be chief econ adviser
- Indians keep faith with Modi, best hope for economy - poll
- Govt raises sugar import duty to 25 pct from 15 pct
More than 70 percent of Indians are satisfied with the leadership of Prime Minister Narendra Modi since he took office nearly three months ago, an opinion poll showed, seeing in him the best hope to put the economy back on track. Full Article
Xiaomi ordered sapphire glass for limited edition phone - S.Korea newspaper. Full Article
Qualcomm will strive for resolution to China anti-trust probe-regulator. Full Article