Facebook facing lawsuit from IPO investors

Investors file lawsuit against Facebook after failing to disclose IPO information

Nasdaq Facebook

Facebook is set to face a lawsuit from investors after the social network company initiated its public offering on 18 May 2012.

The disgruntled investors claim that the company was “selectively disclosing” certain information and material regarding the revenue outlook of the business.

The claim states that an underwriter told major clients that the company was reducing its revenue forecast, although this was not conveyed to smaller investors.

In response to the legal action, a Facebook spokesperson said, “We believe the lawsuit is without merit and will defend ourselves vigorously.”

This is the second lawsuit against Facebook, claiming that the company had failed to portray the forecast reduction of revenue.

Source: Cnet
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