Shareholder Sues Facebook After Stock Plunge (reuters.com) 111
An anonymous reader quotes a report from Reuters: Facebook and its chief executive Mark Zuckerberg were sued on Friday in what could be the first of many lawsuits over a disappointing earnings announcement by the social media company that wiped out about $120 billion of shareholder wealth. The complaint filed by shareholder James Kacouris in Manhattan federal court accused Facebook, Zuckerberg and Chief Financial Officer David Wehner of making misleading statements about or failing to disclose slowing revenue growth, falling operating margins, and declines in active users. Kacouris said the marketplace was "shocked" when "the truth" began to emerge on Wednesday from the Menlo Park, California-based company. He said the 19 percent plunge in Facebook shares the next day stemmed from federal securities law violations by the defendants. The lawsuit seeks class-action status and unspecified damages.
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You're an idiot that obviously doesn't read. First story below is about the loss of stock value and that Facebook might face lawsuits regarding this. This story is about a shareholder ACTUALLY SUING because of said loss of value, plus perceived illegal stock sales.
So this isn't a dupe, it's a different story, though related to the one below.
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It's like going to a casino and then losing your money at the craps table when you roll snake eyes, and then trying to sue the casino./p>
No, it's nothing like that at all. The market (not Facebook) is the casino. Facebook, if you will, makes the dice, and its senior employees are also playing the game with us. And they can, as long as they show us how they bet, and give us their expectations of how the dice will roll. It just so happens that Facebook senior employees bet a good deal more more on a certain roll of the dice this time around, but failed to notify the other players how they expected the dice to roll.
There, FTFY. But frankly, com
"The Menlo Park, California-based company" (Score:2)
Who gives a shit about their address?
It's a hold over from the old days (Score:2)
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Who gives a shit about their address?
It's a journalism technique. Paraphrasing the subject of a story reduces repetition of her/his/its name over and over again. It reads better.
The technique can have amusing consequences if taken too far. Once, a CBC reporter was doing a story about bananas, and the reporter's editor insisted that he reduce the number of repetitions of the word "banana." His solution? Refer to it as "yellow, tubular fruit."
Re: "The Menlo Park, California-based company" (Score:2)
You could just say "the company". No need for an address. Bananas indeed ;-)
Subscribers (Score:2)
At the top of the page: 'Did you know subscribers can see articles in the future?'
Please, subscribers, when you see a dup 'from the future', please try and get the eds to cancel it. That would save some from apoplectic outrage and the rest of us (most) from a minor annoyance.
Please help us! You are our only hope!
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You are assuming there ARE any subscribers.
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There was the assumption that while there was natural churn from people not having time to visit Facebook and provide updates, there would always be a new generation of computer owners willing to sign up, especially when user accounts are automatically created even if they don't use them.
Once the population realized that all these trend-setters and comment makers were sock-puppet accounts deliberately design to manipulate groups of people and even individuals, the game is over.
Re:Suing your own company. (Score:5, Informative)
If you have shares in a company for 1 million dollars, and those shares are 1% of the company's worth, the company is worth 100 million.
If you sue the company for 10 million dollars they lose 10% of their value and are now worth 90 million. Your 1% shares are now only worth 900,000 dollars, right?
But you just got 10 million dollars. Who cares about the shares at that point.
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But you just got 10 million dollars. Who cares about the shares at that point.
If the CEO and CFO are lying about the state of the company then the share price may suffer even more long term. Not every situation is win/lose. As we learnt from the Iraq invasion and the 2016 election, sometimes the choice is lose or lose more.
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In reality, if facebook were being sued for 10% of its value its stock price would likely plumet far more than 10%.
In reality, if it were forced to pay out 10% of its value, it would just go bankrupt.
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seriously? (Score:2)
next, he'll sue the weather for not being what he expected if he goes to the beach and it starts raining
What, no sympathy? (Score:2)
(Today's joke. That the best I can do.)
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More ironic, is that the plunge was in a great part due to shareholder panic. The "disappointing" earnings were still very good earnings.
There will be more (Score:1)
'Web 2.0' was always a farce riddled with flimsy ethics, so is the 'sharing' economy (and a great many people sounded alarms, nobody cared to listen, they heard their greed instead) and I don't doubt we will see more and more companies eating similar crow. Let's hope the bubble doesn't completely burst, as it would be far worse than the original tech bubble.
Can I sue? (Score:2)
I have always wanted to own Facebook, it has caused me pain that I cannot own it due to the manipulation by shareholders to drive up the price. Can I sue the shareholders for inflating the price beyond my means?
It was horribly overpriced (Score:5, Insightful)
Businesses can only grow so fast and only so much. But people bid the prices up as if there is unlimited growth potential.
And when stocks are valued with a growth premium that can never be met, they have a tendency to crash when those lofty expectations aren't meant.
facebook is still quite profitable but wasn't worth what it was trading at.
I think the same way about Amazon and definitely the same about Tesla. Neither of those companies can meet the growth that is priced into the share price.
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Well, my advice would be to not be a day trader.
I'm in Tears here (Score:3)
FTFA :
failing to disclose slowing revenue growth
So the rate of increase is slowing? - that's just awful. But is the rate of the slowing of the increase itself slowing or increasing? - that's what everyone is asking. And is the rate of that increasing (or slowing) of the rate of the slowing of the increase, itself slowing or increasing? How TF can we be drawing graphs and making predictions if they don't tell us these things?
I'm crying a river here for poor Mr Kacouris and my hankies are running out. Let's kickstart a collection for him.
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LoL if I had mod points!
Who cares (Score:2)
It's just another social network in the long line of networks that will come and go. Who's surprised?
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I hope this gets laughed out of court... (Score:5, Interesting)
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There are rules of course, if the company lies on their statements and you lose money that way then a lawsuit is suitable. But many of these stockholder advocates who sue are doing so very frequently, to the point that they've become annoyances to the legal system.
Re:I hope this gets laughed out of court... (Score:4)
This is only part-way true. A corporation still has substantial duties with regard to its shareholders. For instance, they can't just spend all the year's profit on hookers and blow for the board. Nor can they flat out lie.
Of course this case should be laughed out of court. But don't go so far as to say that companies have no duty whatsoever to their shareholders or that all shareholder cases are laughable.
That's now how it works though (Score:2)
Our ruling class are universally investors. They don't do math. They don't make things. They don't do medicine and they don't cook. They invest. So you better believe the law is designed to protect them above all else.
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For non-financial folks (Score:3)
Please be aware these "lawsuits" are usually just scams to suck more money from desperate stock holders. The "lawyers" are the financial version of ambulance chasers.
Anytime a company loses a large percentage of stock value, a lawsuit is announced. For you to be part of the "class action suit" you need to pay the law firm a non-refundable deposit of usually between 200-600 dollars. The kicker is the lawsuit never actually happens and the client is out even more money.
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As much as I dislike shareholder and shareholder derivative suits, no, that is not how it works.
There is no form of class action where the class is "people who paid us." There is no class action where the damages recovered, if any, vary by "people who paid us." At worst, the attorneys h
Actually it's up (Score:2)
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Its the shareholder fault (Score:1)
IThe shareholders are at fault for not dumping a dying stock. People are leaving facebook in droves and they arent getting enough new sign ups. Might be time to dump that myspace stock too.
And who made it? (Score:2)
For all that mind share and news share Tesla got, the whole company was valued at just 50 billion. And these shorts missed the biggest opportunity to profit in Facebook? Did any of them make a killing? Which shorting hedge fund made a killing?
You Didn't Know? (Score:2)
Not sure how anyone could be surprised about this. If you're an investor, you damn well better be paying attention to what the company is doing, and in April when Mark Zuckerberg delivered his prepared testimony to Congress, he laid it all out:
"I've directed our teams to invest so much in security — on top of the other investments we're making — that it will significantly impact our profitability going forward. But I want to be clear about what our priority is: protecting our community is more i
Recursion (Score:2)
If Kacouris can sue Facebook for losing value, or rather not telling him in advance to dump his stock in them,
then other stock holders can sue Kacouris for sueing Facebook, thereby causing tge company to lose value, without telling them in advance.
I doubt that any judge would rule in Kacouris' "favour", but I would laugh if they did.
LOL suckers (Score:1)
I have a better idea (Score:2)
Shocked? (Score:2)
"In terms of our overall 2018 revenue outlook, we continue to anticipate revenue growth rates will decelerate on a constant currency basis throughout the year."
And one of the questions asked included this tidbit: "Growth in MAUs in rest of world was up about 11%; I think last year, it was up almost double that, 19% or so. Anything changed there that maybe could explain the slowdown?"
Q1 Earnings Transcript: https://seekingalph [seekingalpha.com]
Duplicate posting (Score:2)
I guess nobody saw the other post that mentioned this?
https://tech.slashdot.org/stor... [slashdot.org]
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You really want to live in a country like that?
I want to live on a forum with threads not being highjacked by idiots with their own off-topic agendas. They are like the idiots at sports events who creep up to the TV camera and stick a placard with an advert in front of it at a crucial moment.
I
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Re: Easy Fix (Score:1)
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This is the internet... You must be new here.
Re: Easy Fix (Score:2, Offtopic)
Extremist dipshits from both sides should be censored off the internet so we wouldn't have to wade through your inane tantrums and meaningless bitching.
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Re: Easy Fix (Score:1)
Promote minority lives at the expense of everyone else, only to further their own agenda of totalitarianism and control, and will toss them overboard when they no longer serve that purpose, or start displaying conservative viewpoints, at which time the progs will label them as "uncle Tom's" and cast them aside.
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Why would Facebook stop censoring Russians?
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Because people might otherwise switch to VKontakte perhaps? And the latter has no problem with naked tits as well, so nu prudish US censorship anymore.
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Because people might otherwise switch to VKontakte perhaps? And the latter has no problem with naked tits as well, so nu prudish US censorship anymore.
This post is useless without links.