Is Facebook Pointing the Finger at Nasdaq?
Facebook (NASDAQ:FB) is expected to place some blame on Nasdaq OMX (NASDAQ:NDAQ) for its botched IPO as its files a motion to consolidate all the shareholder lawsuits against the social network, the New York Times reported Thursday. The motion could be filed as early as Friday.
The document, which would be filed in the District Court of the Southern District of New York, will provide some perspective on Nasdaq’s role in the Facebook’s disastrous public debut last month, and how a technical glitch and the group’s reaction effecting the stock’s trading activity, the paper said, citing a person with knowledge of the matter.
Morgan Stanley (NYSE:MS), Goldman Sachs (NYSE:GS), and JPMorgan Chase (NYSE:JPM) — the lead underwriters for the initial public offering — are also expected to join the motion, according to the report.The motion will represent the first time Facebook has publicly addressed the lawsuits against it and its lackluster debut on May 18.
Nasdaq has been widely criticized for its poor communication during and after the IPO, the most highly anticipated debut in years, and for failing to apologize for the technical problems in the first hours of trading.
The exchange recently agreed to set aside $40 million to cover broker losses after its system failed to properly process some orders in the first hours of public trading. Nasdaq CEO Robert Greifeld described his company as being “humbly embarrassed,” but the firm has also tried to downplay its role in the stock’s fall. Facebook shares closed Thursday at $28.29, more than 25 percent below its offering price of $38 per share.
More than 30 cases have been filed against Facebook, mostly in New York and California, from investors and traders trying to recoup losses related from that first day of trading.
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