Boston, MA 02\/28\/2014 (wallstreetpr) – Zynga Inc (NASDAQ:ZNGA)<\/b> had a reprieve earlier in the week when U.S. District June ruled shareholders who brought up a case against the company in relation to its December 2011 IPO and April 2012 secondary offering of common stock, as out of order.<\/p>\n
\u00a0The company had been accused to have among other ills, concealed and otherwise fraudulently mislead shareholders about its business and financial prospects before and after its initial public offering of common stock. However, Judge Jeffrey White in San Francisco ruled that the plaintiffs could not provide even basic factual details to back their claims. So then, the lawsuit stand dismissed and Zynga celebrated.<\/p>\n
The disgruntled investors were also ruled out of order when they claimed that the April 2012 secondary stock offering was not done above board. The judge ruled on this matter, saying that the plaintiffs named in the lawsuit lack standing given that they never participated in the purchase of share in the said stock offering. However, that was not all, the judge allowed the disgruntled shareholders to pursue Zynga Inc (NASDAQ:ZNGA) again if they are able to amend their claim.<\/p>\n
Seizing the opportunity<\/b><\/p>\n
The attorney standing in for the plaintiffs Joseph Tobacco who is a partner at the Berman DeValerio has said that his clients will amend the complaint as allowed by the judge. So then, they hope that they will be able to proceed with the case. However, they felt disappointed with parts of the ruling.<\/p>\n
In the now dismissed lawsuit, the shareholders named various defendants including Zynga Inc (NASDAQ:ZNGA) founder Mark Pincus and underwriters Goldman Sachs & Co. (NYSE:GS) and Morgan Stanley (NYSE:MS).<\/p>\n
The highlight of the lawsuit was that the defendants by concealing facts like drop in user activity and delay in product launch being able to negatively affect revenue, ended up inflated the stock price of Zynga.<\/p>\n
Investors Takeaway<\/b><\/p>\n
Zynga Inc (NASDAQ:ZNGA) which went public at $10 but has since dropped to trade in the zone of $5, believes that its future was still very bright regardless of the investors lawsuits against it. What the company is now up to is paying the $527 million which was the cost of acquiring NaturalMotion, a move that is expected to refresh its pipeline, especially in the mobile platform. The company is also going to further reduce its workforce by 15 percent. All these would hopefully maximize shareholder value.<\/p>\n","protected":false},"excerpt":{"rendered":"
Boston, MA 02\/28\/2014 (wallstreetpr) – Zynga Inc (NASDAQ:ZNGA) had a reprieve earlier in the week when U.S. District June ruled shareholders who brought up a […]<\/p>\n","protected":false},"author":13,"featured_media":4857,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":{"twitter_2902945987_2902945987":""},"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[263],"tags":[708,2789],"stock_ticker":[],"class_list":["post-16231","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technology","tag-nasdaqznga","tag-zynga-inc-nasdaqznga","entry"],"acf":[],"yoast_head":"\n