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Nasdaq fails to win dismissal of Facebook IPO lawsuit

17
Dec
2013

By Jonathan Stempel NEW YORK (Reuters) – A federal judge has rejected Nasdaq OMX Group Incs bid to dismiss lawsuits by investors who accused the exchange operator of botching Facebook Incs $16 billion initial public offering, a decision released on Monday shows. Nasdaq had argued that its status as a self-regulatory organization (SRO) gave it immunity from claims it broke securities laws and was negligent in how it executed orders to buy and sell shares of the social media company on May 18, 2012, the first day of trading. In a 97-page decision, U.S. District Judge Robert Sweet in Manhattan agreed that SRO status gave Nasdaq immunity from some claims, including the decision not to halt the IPO. But he rejected Nasdaqs effort to dismiss claims over the design and testing of its systems, including that it allegedly knew its advertised on-time, on-target and ready-to-launch had not undergone the stress tests needed to ensure it was up to handling trading in Facebook.

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