Investors file lawsuits against Zynga top management for disinformation on performance and stock prices – Part 1

Zynga sold share without prior notification to the investors and employees on the matter, employees and investors enraged on the act

Zynga, Inc. is in a bit of a pickle these days, especially the last one week has dragged them deeper into the pits. First news of disappointing revenue growth in the second quarter then plummeting stock prices followed by accusations of insider trading and now two shareholder lawsuits, all these the circumstances do not bode well for the company’s future.

Zynga is one of companies that went public last year. LinkedIn and Groupon were the others. However, unlike LinkedIn, the online gaming company’s IPO was an utter failure right off the bat.

In the recent events, the company submitted the second quarterly earnings to the security and exchange commission (SEC) last week that showed a meagre improvement over the performance disclosed in the first report three months ago.

The dust over the report had not settled yet that the company is now being dragged into the court for alleged disinformation on stock prices or the complete lack of it thereof.

“Zynga misrepresented or failed to disclose material adverse facts about its business, operations, and growth prospects,” said the lawsuit filed late on Monday by Kessler Topaz Meltzer & Check, according to Reuters. The second lawsuit was filed today by Robbins, Geller, Rudman and Dowd.

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Posted by Usman Khalid on Aug 2 2012. Filed under Pakistan. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.