Privacy and FB IPO: Facebook Lawsuit Times Two
Facebook Facing Class Action Lawsuit Over Privacy Violations and Morgan Stanley, Facebook and Goldman sued over Facebook IPO
NEW YORK, NY - There is more than one Facebook lawsuit in the works since the FB IPO. Last week, on Thursday, May 17, in federal court in San Jose, California, a class action lawsuit was filed against Facebook. The plaintiffs claim Facebook abusively tracked subscribers even after they logged out. The suit consolidates 21 lawsuits nationwide.
And yesterday, Facebook and its IPO underwriters found out they are being sued by investors who claimed they were misled in the purchase of the social network firm’s stock, especially when it came to valuation of the company and revenue predictions.The investors have said the members of a proposed class action lawsuit have lost more than $2.5 billion since the Facebook IPO last week, according to a complaint filed today in Manhattan federal court.
PC Magazine wrote:
Furthermore, as The Wall Street Journal points out, Facebook receives a disproportionate amount of revenue from Zynga and other game developers. That works just fine on the desktop. But on smartphones and tablets, Facebook hasn't yet managed to create a platform that will lure those developers into essentially residing within Facebook, rather than writing their own apps for iOS and Android and keeping all the revenue. One does not launch Facebook's mobile app to play games like "Mafia Wars," and it looks like this won't be the case for several years.
Reuters has a story about analysts predictions for Facebook stock - saying it could go as low as $10 to more accurately reflect the actual valuation of the social media company.
They wrote, "Data from six brokerages modeled by StarMine forecast the company's estimated annualized earnings growth over the next 10 years at 10.8 percent. That's almost exactly the mean for the technology sector and far below the 24 percent growth rate implied by the current stock price."
Boston.com had a write-up of how other social media companies fared on Monday of this week after the FB IPO, "Shares of some related social media companies also declined Monday. Zynga Inc., which makes FarmVille, CityVille and Mafia Wars, and gets the bulk of its revenue from Facebook users, fell about 1 percent to $7.07.. LinkedIn Corp., a network for professionals, dropped 1 percent to $97.99."
As of May 24 at 10:31am ET, Facebook stock is at 32.18, up +0.18 (0.56%) from the opening price of 32.95.