The loading screen of the Facebook application on a mobile phone is seen in this file photo illustration taken in Lavigny May 16, 2012. - Reuters Photo

Thu Oct 4, 2012 - Dozens of lawsuits against Facebook Inc, the NASDAQ exchange and various underwriters will be centralized before a federal judge in New York, who must sort through the legal aftermath of Facebook's botched initial public offering.

A panel of federal judges on Thursday ordered that cases filed around the United States be transferred to U.S. District Judge Robert Sweet in Manhattan. Facebook had requested the transfer, while some investors sought to keep their cases in California.

While some of the cases concern different defendants and claims, "they do involve enough common questions of fact, related circumstances and common discovery to warrant centralization," the panel said.

Facebook said in a statement that it was pleased with the ruling, and that it would "vigorously" defend itself. An attorney for some of the California plaintiffs declined to comment, while a NASDAQ representative did not immediately respond to a request for comment.

Investors say they lost money due to technical glitches on the Nasdaq stock market and accuse the company of selectively disclosing unflattering information about its business prospects to Wall Street analysts who then shared it with privileged investors.

The lawsuits, which are seeking unspecified damages, could cost Facebook millions of dollars to defend as it strives to put the IPO behind it.

Facebook's stock tumbled as much as 50 percent after its debut at $38 per share. It closed at $21.95 on Thursday.

In at least 33 lawsuits seeking class action status, investors have asked courts to hold the company and its underwriters responsible for causing their losses.

Facebook has said that it did not violate any rules and that NASDAQ was to blame for trading glitches on the day of the offering.

Grouping cases together keeps similar lawsuits from proceeding at the same time in different courts.

Lawsuits against NASDAQ OMX Group Inc, which accuse the exchange of being negligent in failing to execute trades in the face of record-breaking volume during the IPO, will also be in front of Sweet.

But the exchange has already asked that their cases proceed on a separate track from the Facebook lawsuits.

The case is In Re: Facebook Inc, IPO Securities and Derivative Litigation, U.S. Judicial Panel on Multidistrict Litigation, No. 12-md-2389.

Opinion

Editorial

Judiciary’s SOS
Updated 28 Mar, 2024

Judiciary’s SOS

The ball is now in CJP Isa’s court, and he will feel pressure to take action.
Data protection
28 Mar, 2024

Data protection

WHAT do we want? Data protection laws. When do we want them? Immediately. Without delay, if we are to prevent ...
Selling humans
28 Mar, 2024

Selling humans

HUMAN traders feed off economic distress; they peddle promises of a better life to the impoverished who, mired in...
New terror wave
Updated 27 Mar, 2024

New terror wave

The time has come for decisive government action against militancy.
Development costs
27 Mar, 2024

Development costs

A HEFTY escalation of 30pc in the cost of ongoing federal development schemes is one of the many decisions where the...
Aitchison controversy
Updated 27 Mar, 2024

Aitchison controversy

It is hoped that higher authorities realise that politics and nepotism have no place in schools.