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Facebook execs get judge to toss four IPO-related lawsuits

Published on Feb 14, 2013 5:55 AM
 
Facebook chief executive Mark Zuckerberg listens to a question after introducing a new feature called Graph Search during a media event at Facebook headquarters in Menlo Park, California on Jan 15, 2013. Mr Zuckerberg and other executives won the dismissal on Wednesday of four shareholder lawsuits following the social networking company's US$16 billion (S$20 billion) initial public offering last year. -- PHOTO: REUTERS

NEW YORK (REUTERS) - Facebook Inc chief executive Mark Zuckerberg and other executives won the dismissal on Wednesday of four shareholder lawsuits following the social networking company's US$16 billion (S$20 billion) initial public offering (IPO) last year.

United States District Judge Robert Sweet in Manhattan concluded that the individual investors who brought the cases could not establish standing to sue because they were not Facebook shareholders at the time the alleged wrongdoing took place.

Facebook still faces many other claims from various plaintiffs over its IPO last May. The cases largely centre on allegations that Facebook executives failed to make adequate disclosures ahead of the IPO about weakened revenue growth projections resulting from greater use of the company's website through mobile devices.

Fifty-three lawsuits have been consolidated before Judge Sweet stemming from the IPO. The lawsuits are a continuing headache for Facebook and a reminder of the glitches that tarnished one of the most hotly anticipated new stock offerings in recent memory.

 
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