A class-action lawsuit -- filed yesterday, June 3rd, in the United States District Court of Manhattan -- claims that the Facebook creator knew his stock was terribly overpriced at $38 per share last month, when the trading began. With this inside information, he quickly unloaded shares. If the complaint is true and accurate, this was clearly a highly unethical move on the billionaire's part.
Facebook was down 27% last Friday, June 1st -- since it went public on May 18, 2012.
In the class-action lawsuit, the complaint calls out Zuckerberg and company of hiding the business "flaw" of his stock, was was: there is simply not enough advertising revenue to support a thirty-eight dollar per share opening price.
Essentially, the suit suggests that this business "flaw" information was only shared with its largest investors, which Zuckerberg and company did through "selective discourse" methods (as reported by Daily Mail).
Stock market analysts have constantly held doubts about Facebook's valuation, prospects in the moible market, and its overall ability to compete with Google.
After this Facebook situation, Nasdaq's market structure and market quality as a whole has been put under scrutiny.
Allegedly, Facebook is developing technology that would allow children younger than 13 years old to use the social-networking site (under parental supervision). Under Facebook's current policy, users under 13 years of age are banned. Although this is not part of the class-action suit, there is something seriously questionable about this situation.
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