Investors are suing Morgan Stanley, Goldman Sachs, JP Morgan and other underwriters of the Facebook IPO, alleging the banks misrepresented the strength of the stock. But the plaintiffs may have a difficult time proving the case, explained Buchanan Ingersoll & Rooney Corporate Shareholder Jeremy Garvey.
“It’s going to depend on who knew what when,” he said in a phone interview with Bloomberg News.
“The real question is, based on the final prospectus, were the statements complete and correct?” Garvey said. “If they have enough cautionary language in the prospectus, they do have a bit of a disclaimer.”