Facebook, banks sued over pre-IPO analyst calls

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http://www.reuters.com/article/2012/05/23/us-facebook-lawsuit-idUSBRE84M0RK20120523

Facebook Inc and lead underwriter Morgan Stanley were sued by shareholders who claimed they hid the social networking company's weakened growth forecasts ahead of its $16 billion initial public offering.

The lawsuit came as Facebook and the banks that took it public face questions about the IPO, which culminated in a May 18 stock market debut plagued by technical glitches.

Facebook shares fell 18.4 percent from their $38 IPO price in their first three trading days. They were up $1.08, or 3.5 percent, at $32.08 in Wednesday afternoon trading.