Social networking site Facebook has decided to blame its slumping share price on the fact that there were trading problems at the Nasdaq stock market on the day it launched.
The excuse has come out in a court filing in which Facebook and the banks, led by Morgan Stanley, are seeking to combine the more than 40 federal and state lawsuits around the country into one federal case in New York.
Furious shareholders are suing everyone connected to the Facebook share crash. There were some problems with the handling of the IPO but the defendants also insist that nothing about its IPO process was illegal.
Facebook said those glitches at Nasdaq hurt its stock for days and seven of the lawsuits claim that Nasdaq errors created market uncertainty and caused shareholders to lose money. The Nasdaq has admitted that there were technical problems.
But the bulk of the shareholder lawsuits centre on Facebook's 9 May disclosure that the number of mobile users it has was growing faster than revenue.
Analysts at banks involved in those discussions disclosed the changes only to a handful of preferred clients who did not waste so much cash on the outfit.
Facebook claimed this was all perfectly normal and did not violate any rules.
The 9 May filing "did not include any forward-looking projections" although an analyst would see what Facebook did forecast in terms of not having so much future profit.
Facebook wants to bring the lawsuits to New York in part because that's the home to most of the banks involved in the IPO. It's also where many of the events in dispute took place and where the Nasdaq is headquartered.
Facebook is still scrapping with federal regulators, who had wanted to know more about the revenue it gets from mobile devices, its $1 billion deal to buy Instagram and the control CEO Mark Zuckerberg has over the company.
Facebook's stock is worth about $30.01 down 21 percent from its IPO price of $38. The company's chief technology officer, Bret Taylor, announced that he is leaving the company to work on a startup.
So far no one has actually said that the price of the shares were completely over valued. At the full price the company was worth $100 billion with falling advertising revenue and not many plans in place for mobile customers. At the moment it can make a respectable $1 billion a year in profit. Which means it would actually be worth what shareholders paid for it in about a hundred years.