IPO-Related Lawsuits Against Facebook Consolidated, To Be Heard In New York

By David Cohen 

All of the lawsuits over Facebook’s bungled initial public offering are going to make a brand-new start of it in old New York, as a panel of federal judges ruled Thursday that cased filed throughout the country are to be transferred to U.S. District Judge Robert Sweet in Manhattan, according to reports.

Reuters reported that Facebook had been pushing for the cases to be consolidated in New York, while some investors and other litigants wanted them to be heard in California.

The panel said that while the cases involve different concerns and claims:

They do involve enough common questions of fact, related circumstances, and common discovery to warrant centralization.

And Facebook said in a statement that it was pleased with the ruling, and it would “vigorously” defend itself.

The lawsuits involve the technical glitches on the Nasdaq stock exchange on May 18, the first day of trading for Facebook stock.

Nasdaq submitted a plan to the Securities and Exchange Commission to compensate trading firms that were affected by the bungled IPO, but, according to Reuters, many of the suits Facebook is facing accuse the social network of selectively revealing negative sentiment about its business prospects to certain analysts, who then shared that information with “privileged investors.”

Readers: Do you think Facebook is better off having these cases heard in New York, as opposed to California?