Morgan and Morgan Files Class Action Suit Against Facebook, Inc.

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Morgan & Morgan today announced that it filed a class action  in the United States District Court for the Southern District of New York on behalf of purchasers of Facebook, Inc. (“Facebook”) (NASDAQ: FB) who acquired shares of  common stock pursuant or traceable to the Company’s May 18, 2012 initial public offering (“IPO”).

If you purchased Facebook shares pursuant or traceable to the Company’s May 18, 2012 IPO, you may, no later than July 23, 2012, request that the Court appoint you lead plaintiff of the proposed class. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. Any member of the purported class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.

Facebook’s  May 18, 2012, IPO raised over $16 billion by selling over 420 million shares of the Company’s common stock to investors at a price of $38.00 per share.  In connection with the IPO, certain Defendants filed a Registration Statement with several amendments and a Prospectus.

The Complaint alleges that the Registration Statement issued in connection with the IPO was materially false and misleading in violation of the federal securities laws. More particularly, the complaint notes that Facebook failed to disclose to the investing public the material information that the company was experiencing, and anticipating, a significant drop in revenue due to an increase of users accessing Facebook through mobile devices. According to news reports, this lower revenue projection was selectively released by underwriter banks to only certain clients and not included in the Registration Statement.

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By Staff