Shalom Life | May 25, 2015

Facebook, Zuckerberg and Morgan Stanley get Sued by Investors

Suit filed against the social media giant over withholding negative information from the public for its IPO

By: David Shear

Published: May 23rd, 2012 in Business » World

Facebook, Zuckerberg and Morgan Stanley get Sued by Investors

This wasn’t supposed to go like this. Facebook, the internet darling and the savior of high-tech IPOs, was supposed to go gangbuster on the financial world. Investors expected to get in early and get rich quickly, but sometimes things don’t go according to plan, especially when greed is concerned.

Yesterday news broke out that Facebook, Morgan Stanley and a host of other underwriters withheld negative information about the social network’s initial public offering. On Wednesday, three investors sued Facebook and their CEO Mark Zuckerberg, along with Morgan Stanley, for unfair conduct.

"It appears as though material information was not disclosed," said Robert Weiser, one of the plaintiff lawyers in the class action suit. "We believe that the offering was conducted unfairly and it harmed public stockholders."

According to reports of the suit, which has been filed in the U.S. District Court for the Southern District of New York in Manhattan, Morgan Stanley shared negative information regarding Facebook’s upcoming quarter results with major clients ahead of their IPO, while withholding this information from the public.

The "revisions were material information which was not shared with all Facebook investors, but rather, was selectively disclosed by defendants to certain preferred investors and omitted from the registration statement and/or prospectus," the plaintiffs claim.

Other underwriters targeted by the lawsuit include JPMorgan Chase, Bank of America, Merrill Lynch, Barclays Capital and Goldman Sachs.

It is believed that more plaintiffs may join the class action lawsuit.

Israeli Companies Make Gartner's Innovative 'Cool Vendors' List Israeli Companies Make Gartner's Innovative 'Cool Vendors' List TrendingJEDx 2015 Gives Toronto's Young Professionals a Real Life Lesson JEDx 2015 Gives Toronto's Young Professionals a Real Life Lesson TrendingNeat Israeli Pen Lets You Answer Calls and Send Texts Without Your Phone Neat Israeli Pen Lets You Answer Calls and Send Texts Without Your Phone Trending
 

After Decades of Silence from Olympics Committee, Murdered Israeli Athletes to Finally be Recognized

May 25, 2015 | By Maayan Jaffe
After Decades of Silence from Olympics Committee, Murdered Israeli Athletes to Finally be Recognized

A first-ever IOC-supported official memorial to victims of the Munich Massacre will be erected in Munich in time for Rio 2016

Read More

WATCH: Journalist Shows What it's Like to Walk Around as a Jew in Cairo

May 25, 2015 | By Ynet News
WATCH: Journalist Shows What it's Like to Walk Around as a Jew in Cairo

Egyptian journalist gets harassed dressed as a religious Jew, though he does get a couple compliments too

Read More

Israeli Makes Eurovision Finals for First Time in 5 Years

May 22, 2015 | By Shaleni McBain
Israeli Makes Eurovision Finals for First Time in 5 Years

'Golden Boy' Nadav Guedj hopes to live up to his name

Read More

Israeli Companies Make Gartner's Innovative 'Cool Vendors' List

May 22, 2015 | By Einat Paz-Frankel, NoCamels
Israeli Companies Make Gartner's Innovative 'Cool Vendors' List

18 out of 350 companies selected by leading American IT research firm Gartner are from the Holy Land

Read More

Jewish Community Center Cancels Marijuana Art Classes

May 22, 2015 | By Shaleni McBain
Jewish Community Center Cancels Marijuana Art Classes

Class that welcomed cannabis usage at Aspen Community Center in Colorado quickly nixed

Read More

Israel in Top 10 Countries for Gay Men

May 22, 2015 | By Shaleni McBain
Israel in Top 10 Countries for Gay Men

Country ranks #7 on the happiness index

Read More

Canadian Holocaust Survivor Recognizes Himself in Online Photo

May 22, 2015 | By Daniel Koren
Canadian Holocaust Survivor Recognizes Himself in Online Photo

Yehuda Danzig of Toronto was stunned when he came across a pic of himself and his younger brother while reading The Times of Israel

Read More

Seven Ways to Celebrate a Meaningful Shavuot

May 22, 2015 | By Maayan Jaffe, JNS.org
Seven Ways to Celebrate a Meaningful Shavuot

Here are a few ways to infuse some meaning and minhag (tradition) into your Shavuot this year

Read More

More Headlines