If history is any guide, the tanking of Facebook owner Meta’s stock could make its way to Delaware courts.
Shares of the company fell by 26% in Thursday trading after what Wall Street viewed as a dismal earnings report. Shares fell another 1% today in morning trading.
The stock plunge led to a rough overall day on the street that continued into Friday.
Headlines included founder and CEO Mark Zuckerberg losing (on paper) $30 billion from his investment in the company.
At first glance, it might seem that Karma was at work given the string of controversies over issues that include the platform’s reputed ability to spread misinformation over elections and Covid-19, as well as stumbles in its response.
Instead, Facebook focused on issues that include an Apple privacy feature on its IOS operating system that reduces the ability to mine user information. That makes its lucrative advertising less effective, perhaps to the tune of $10 billion in 2021 revenue.
Some also suspect that the rebranding of the Instagram, What’s App umbrella company to Meta was not the wisest move.
The name comes out of the overused term “the metaverse,” which includes Meta’s Oculus virtual reality system and a host of other possible uses for the 3D virtual reality technology.
Since Meta is a Delaware-domiciled company, shareholder law firms that monitor tanking stocks could file actions here against Meta and its board.
Meta is no stranger to Delaware courts, including a 2021 Chancery Court ruling over a class of stock.
Enjoy your weekend, even with our weather roller-coaster. – Doug Rainey, chief content officer.