June 8 - David Goldberg is part of a class action lawsuit against Facebook and its bankers, claiming vital sales and profit forecasts were with-held from mom-and-pop investors like him. Conway G. Gittens reports.
PLEASE NOTE: THIS EDIT CONTAINS CONVERTED 4:3 MATERIAL David Goldberg is one of the many investors looking to the courts for justice over the now infamous Facebook IPO. SOUNDBITE: DAVID GOLDBERG, PLAINTIFF IN CLASS ACTION LAWSUIT AGAINST FACEBOOK, BANKERS (ENGLISH) SAYING: "After buying the 1,000 shares at $38 I became aware that the company held back certain information concerning the financials of Facebook: its yearly revenues, its yearly profits, the quarterly profits; and I felt that this was, you know, something that should have been presented to the stockholders, to the people who were going to buy Facebook at the initial public offering before we were able to participate in the offering." Goldberg is part of a lawsuit filed June 1st, against Facebook and its bankers including lead underwriter Morgan Stanley, claiming the banks gave an unfair advantage to some clients, selectively revealing key information about Facebook's revenues and earnings, while at the same time selling the IPO to new investors. SOUNDBITE: DAVID GOLDBERG, PLAINTIFF IN CLASS ACTION LAWSUIT AGAINST FACEBOOK, BANKERS (ENGLISH) SAYING: "We didn't have this information about the reduction in earnings for the year, for the quarter and I think that alone showed that it just wasn't, again, a level playing field for the small investor and I feel hurt by that." Morgan Stanley denied those claims, first revealed in a Reuters article, which Goldberg's attorney, David Goldenberg, says convinced him investors had been wronged. SOUNDBITE: ANDREW R. GOLDENBERG, ATTORNEY, REPRESENTING DAVID GOLDBERG AND OTHERS IN LAWSUIT (ENGLISH) SAYING: "They profited at the detriment, to the detriment, of the everyday mom and pop investor who thought that they were investing in a company that had, that was generating solid revenues and they would have substantial revenue growth going forward." Investors and trading firms have yet to recover from the pandemonium on opening day, May18. And shares are still 26 percent below their $38 IPO price, giving Goldberg a sense of distrust. Conway Gittens, Reuters