Facebook And Banks Face Lawsuit Over IPO

Facebook, its CEO and several banks must face a lawsuit over alleged misleading of investors ahead of the company's initial public offering, a judge has ruled.

Mark Zuckerberg and dozens of banks are accused of misleading investors about the social media company's financial condition before its $16bn IPO in May 2012.

In a decision made public on Wednesday, US District Judge Robert Sweet said investors could pursue claims that Facebook omitted material information from its registration statement.

The investors allege, among other things, that Facebook should have disclosed internal projections on how increased mobile usage and product decisions might reduce future revenue.

In an 83-page decision, Judge Sweet said higher mobile usage had already had a "material negative" impact on revenue, and that the company should have disclosed more about the relationship.

Investors accuse Facebook of misleading them on mobile usage

"The company's purported risk warnings misleadingly represented that this revenue cut was merely possible when, in fact, it had already materialised,'' the judge wrote.

"Plaintiffs have sufficiently pleaded material misrepresentation(s) that could have and did mislead investors regarding the company's future and current revenues."

A spokeswoman for Menlo Park, California-based Facebook had no immediate comment.

On Monday, Judge Sweet issued a decision that investors could also pursue claims accusing Nasdaq OMX Group Inc of concealing technology problems that led to difficulties in processing trades on May 18, 2012 - Facebook's first day of trading.

The company went public at $38 per share. The price rose as high as $45 on the first day, but quickly fell below the offering price and stayed there for more than a year.

Facebook is now profitable, and is expected to join the Standard & Poor's 500 index after the close of trading on Friday.

:: Watch Sky News live on television, on Sky channel 501, Virgin Media channel 602, Freeview channel 82 and Freesat channel 202.

Anda sedang membaca artikel tentang

Facebook And Banks Face Lawsuit Over IPO

Dengan url

https://temannyakawanya.blogspot.com/2013/12/facebook-and-banks-face-lawsuit-over-ipo.html

Anda boleh menyebar luaskannya atau mengcopy paste-nya

Facebook And Banks Face Lawsuit Over IPO

namun jangan lupa untuk meletakkan link

Facebook And Banks Face Lawsuit Over IPO

sebagai sumbernya