The West

Shareholders file lawsuit over Facebook float
Shareholders file lawsuit over Facebook float

A group of shareholders has filed a lawsuit against Facebook, its executives and Morgan Stanley, the lead underwriter in the company's IPO last Friday.

The lawsuit comes as Facebook Inc stock climbs on Wednesday after a two-day decline. The stock is up $US1.03, or 3.3 per cent, to $US32.03.

That's still nearly 16 per cent below the initial public offering price of $US38.

The lawsuit, filed in US District Court in New York, claims the company's IPO documents contained untrue statements and omitted important facts, such as a "severe reduction in revenue growth" that Facebook was experiencing at the time of the public offering. The suit's three plaintiffs claim they were damaged.

In a statement, Facebook said the lawsuit is without merit. Morgan Stanley declined to comment.

The West Australian

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