Facebook Inc (NASDAQ: FB) Investor Securities Class Action Lawsuit 01/27/2017

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Company Name(s): 
Facebook
Case Name: 
Facebook Shareholder Class Action Lawsuit 01/27/2017
Case Status: 
Case Dismissed
Affected Securities
NASDAQ: FB
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
01/27/2017
Class Period Begin: 
05/05/2014
Class Period End: 
11/02/2016
Court of Filing: 
U.S. District Court for the Central District of California
Deadline To File for Lead: 
03/28/2017
Case Dismissed: 
10/04/2017
Summary: 

October 4, 2017 - The court granted defendants' motion to dismiss without prejudice.

August 15, 2017 - Defendants filed a motion to dismiss.

June 16, 2017 - The lead plaintiffs filed an amended complaint on behalf of investors who purchased Facebook Inc (NASDAQ: FB) common shares between May 5, 2014 and November 2, 2016. The lead plaintiff alleges that the defendants violated the Securities Exchange Act of 1934 by issuing false and misleading statements between May 5, 2014 and November 2, 2016.

April 27, 2017 - Lead plaintiffs and lead counsel were appointed.

March 28, 2017 - Lead plaintiff motions were filed.

January 27, 2017 - An investor in shares of Facebook Inc (NASDAQ: FB) filed a lawsuit in the U.S. District Court for the Central District of California over alleged violations of Federal Securities Laws by Facebook Inc in connection with certain allegedly false and misleading statements made between May 5, 2014 and December 9, 2016.

According to the complaint the plaintiff alleges on behalf of purchasers of Facebook Inc (NASDAQ: FB) common shares between May 5, 2014 and December 9, 2016, that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that between May 5, 2014 and December 9, 2016, the defendants made false and/or misleading statements and/or failed to disclose that Facebook Inc’s metrics to calculate the average time users spent watching videos was overestimated by between 60% and 80%, that Facebook Inc provided inaccurate statistics to advertisers regarding the amount of activity their ads received on the Website, and that as a result, the Defendants’ public statements were materially false and misleading at all relevant times.

On May 5, 2014, Facebook Inc posted a release entitled “Introducing video metrics’ to the website’s business page. The plaintiff claims the release touted Facebook Inc’s advertising products which would allow advertisers to measure the performance of their ads with metrics calculated by Facebook Inc.

Facebook Inc reported that its annual Total Revenue rose from over $12.46 billion in 2014 to over $17.92 billion in 2015 and that its Net Income rose from $2.94 billion in 2014 to over $3.68 billion in 2015.

On September 22, 2016, an article was published entitled “Facebook Overestimeted Key Video Metric for Two Years”

Shares of Facebook Inc (NASDAQ: FB) grew from $56.75 per share in April 2014 to as high as $132.07 per share in October 2016.

In November 2016 Facebook Inc issued a release entitled “An Update on Metrics and Reporting”. The plaintiff claims that this release disclosed additional faulty metric and announced that Facebook Inc needed to update its metrics to provide clarity and confidence.

Then on December 9, 2016, which was subsequently updated on December 12, 2016, Facebook Inc posted the article “Metrics FYI: Estimated Reach, Streaming Reactions, and Graph API” to the Webstie’s business section. The plaintiff says that the article discussed Facebook Inc’s additional changes to address problems with calculating metrics.

Shares of Facebook Inc (NASDAQ: FB) declined to as low as $115.05 per share.

On January 27, 2017, NASDAQ: FB shares closed at $$132.18 per share.