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Mark Zuckerberg Sued

Sold a Billion $$$

Before FB Disaster

6/4/2012 6:33 AM PDT BY TMZ STAFF
breaking news

0604_mark_zuckerberg
A new lawsuit claims Mark Zuckerberg pulled a billion dollar fast one on Facebook investors.

The class action lawsuit -- filed by disgruntled Facebook shareholders -- claims the 28-year-old CEO had inside info that the stock was grossly overvalued, and he protected his own financial hide by quickly unloading a ton of Facebook stock.

This is the second time in two weeks a group of FB shareholders have joined together to accuse the mogul of withholding information.

The lawsuit claims Zuckerberg and his cronies hid the fact that there was a foundational flaw in the Facebook business model -- that there was not nearly enough advertising revenue to support a stock valued at $38 a share.

The lawsuit claims Morgan Stanley, JPMorgan, and Goldman Sachs -- all sounded the alarm before the IPO that Facebook was seriously overvalued, but that information was "selectively disclosed" to the largest investors.

Then again, hasn't Mark suffered enough.  He's only worth around $15 billion.

124 COMMENTS

No Avatar
31.

w    

wow, I am totally suprised *Sarcasm*

well folks, Facebook will doom the market.

879 days ago
32.

SpeakTheWord    

Just like how he stole the FB idea .This guy is a criminal.

879 days ago
33.

Carl    

How is there "not being nearly enough advertising revenue to support the stock price" insider information? I and many others have been saying that since before the IPO. Heck, GM pulled their Facebook advertising just before the IPO. If that isn't a clue nothing is.

879 days ago
34.

CC    

Some have said that Zuckerberg was a liar and a fraud when he alledgedly stole the code for Facebook. Others have said the people associated with Zuckerberg who have renounced their citizenship were just as bad. If either were true why would anyone in their right mind believe the IPO of this company was worth anywhere near the stated value?

879 days ago
35.

Tek    

This is stupid. He sold a billion worth of shares because he has a tax liability for owning $15 billion dollars worth of stock! It was also do***ent well in advance that he would be doing so.

879 days ago
36.

BB not bb    

From what I know, the markets go up and down. I heard experts say that it might take a year to level off and the true value to be shown. If facebook is still growing as a company, I assume that means the value of the stock will grow. People shouldn't panice but maybe sit tight for awhile. Facebook is still wildly popular and people are practically forcing you to be on it to enter constests, win prizes, chat with them, see groups, etc.

Maybe it will end up being worth about what they paid for it in a year's time. Then they can see if it grows or sell it.

879 days ago
37.

Me    

Uhhmm, Duh !

It was made public, right before the shares went IPO, that Facebook employees sold their stocks.

How is this news now ? Thing is, is everyone knew better, yet they bought anyway. Oh well.

LMAO ! Everyone lost, and this was known right after it went public !

879 days ago
38.

Octocunny    

greedy people got screwed...too bad it wasn't lethal

879 days ago
39.

Scott    

Anything is only "worth" what people are willing to pay for it. To the people that bought air on the internet somewhere... They would have bought some magic beans somewhere else.

879 days ago
40.

EGR    

You guys are all idiots. He sold $1b worth of stock to pay his tax bill because he doesn't intend to skip out on paying taxes. It's not insider trading or anything nefarious, he still owns a ton of stock and the position he sold, he won't see cash from, not to mention he's worth about $15b still only based on his fb stock.

879 days ago
41.

Gurgle    

the fast one he pulled was the 1 Billion he spent on instagram before the IPO..... I'm sure it's convoluted, but I suspect a large piece is in a numbered account somewhere, and Mark has the number.

879 days ago
42.

DaveT    

Mark Zuckerberg probably didn't have anything to do with founding Facebook, he's probably just a puppet hired by others.
He's young, perky, happy-go-lucky, wears the same priced clothes as the average middle class person...he's a perfect puppet character to use as a face for a company.
Wouldn't that be fun, finding out Mark Zuckerberg is just a hired actor for a social network that was created by people who were already rich :D

879 days ago
43.

Justin    

The people suing wanted to make a quick buck and got what sometimes happens. You lose. Zuckerberg selling off 1/15th of his shares was incredibly smart. He never has to work again. I'd have sold too, probably more, and said "to heck with it, I'm buying Greece." No one anywhere said Facebook was really worth the $38 price. Those who bought it are just poor investors.

879 days ago
44.

chedderbob    

The same thing that happened to Martha Stewart should happen to him. I love rb but f him

879 days ago
45.

Salvatore    

If it looks like a snake, acts likes a snake, talks likes a snake and slithers like a snake. . .

He's a venal, soulless little worm, so is this really such a surprise? I hope he's sued for everything he's worth, and that the Facebook Epidemic will be exterminated once and for all.

879 days ago
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