New York: It seems that things are not going in favour of the social networking giant, Facebook. The stocks of the company are already at its low and now a shareholder has filed a lawsuit against Facebook Inc and its Chief Executive Mark Zuckerberg.
As per the report published on Reuters, Mark Zuckerberg and Facebook Inc have been sued by a shareholder for wiping out about $120 billion wealth.
James Kacouris, a shareholder of Facebook, filed the lawsuit in Manhattan federal court accusing Zuckerberg and Chief Financial Officer David Wehner. Wehner and Zuckerberg have been accused of not revealing the sluggish revenue growth, falling operating margins and decrease in active users.
In his complaint, Kacouris said that it was a shock for the marketplace after the truth was revealed from the Menlo Park, California-based company, on Wednesday. He further said that the downfall in the shares of Facebook by 19 per cent on the very next day emanate the federal securities law violations.
Notably, in the United States, a shareholder has rights to file a lawsuit against the company if there is an unexpected decline in the stock price and that too if the wealth lost is huge.
The case filed by Kacouris urges class-action status and unspecified damages. There was no response to the queries from the Facebook spokeswoman.
Facebook Already Facing Dozens of Lawsuits
Apart from this fresh lawsuit, the social networking giant is already facing dozens of lawsuits in regard to the handling of user data in a scandal concerning the U.K. firm Cambridge Analytica. Many of those lawsuits have been merged in the Federal Court in San Francisco.
The downfall in the shares of Facebook on Thursday had hit Zuckerberg’s bottom line.
According to Forbes Magazine, Zuckerberg was holding the fourth position in the list of world’s richest person with Warren Buffett but now Chairman of Berkshire Hathaway Inc has gone past him as his wealth was recorded to be $83 billion while Zuckerberg’s was $66 billion. As per the latest information, Buffett now ranks third while Zuckerberg has slipped down to sixth in the list of world’s billionaires.
A decline of 0.8 per cent was seen in the shares of Facebook on Friday as it closed at $174.89 on the Nasdaq.
The case is Kacouris v Facebook Inc et al, U.S. District Court, Southern District of New York, No. 18-06765.