Morgan Stanley, Goldman Sachs Sued Over Facebook IPO

Discussion in 'Media' started by hvactec, May 28, 2012.

  1. hvactec
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    Morgan Stanley (MS), Goldman Sachs Group Inc. (GS), JPMorgan Chase & Co. (JPM) and other underwriters along with Facebook Inc. (FB) were sued by investors who claimed they were misled in the purchase of the social network firm’s stock.

    The plaintiffs, who are seeking to proceed on behalf of a class of Facebook investors, said the company and the banks didn’t disclose lower revenue estimates before the share sale. The members of the proposed class have lost more than $2.5 billion since the initial public offering last week, according to a complaint filed today in Manhattan federal court.

    "The true facts at the time of the IPO were that Facebook was then experiencing a severe and pronounced reduction in revenue growth,” the plaintiffs said in the complaint.

    Also sued were units of Bank of America Corp. and Barclays Plc (BARC), as well as Facebook Chief Executive Officer Mark Zuckerberg and Chief Financial Officer David Ebersman.

    read more Morgan Stanley, Goldman Sachs Sued Over Facebook IPO - Bloomberg
     

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