Massachusetts Secretary of Commonwealth William Galvin has reportedly issued Morgan Stanley with a subpoena as part of an investigation into Facebook's IPO, while two investors are taking legal action against Facebook, Nasdaq and Morgan Stanley following the botched market debut.
Galvin has issued the legal request for documentation or testimony following a move by underwriter Morgan Stanley to downgrade its revenue forecast for Facebook ahead of the float. Morgan Stanley is facing allegations it did not properly disclose the revised projections to investors during a roadshow. Investor Darryl Lazar has filed a proposed class-action lawsuit against Facebook, Mark Zuckerberg and Morgan Stanley, alleging Facebook's registration and prospectus were materially false. A statement from plaintiff law firm Glancy Binkow & Goldberg read: "The offering materials provi...
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