So with today’s DISCOUNT NEWS we chat about a FACEBOOK lawsuit…and it’s not too pretty. Plus, another ruling from the Supreme Court that’s an update from the story about in vitro and dead parents.


The excitement over Facebook’s debut on the Nasdaq stock exchange Friday has given way to investor fury. The immediate decline in its share price, along with allegations that Facebook and its underwriters failed to disclose relevant information to investors, has prompted government inquiries and multiple lawsuits, including one that involves California plaintiffs. Legal experts say others are surely on the way. At this stage, it’s unclear if the social-networking giant or its underwriters violated the nation’s complicated maze of securities laws. The key question is whether Facebook properly disclosed all material facts about the company’s financial performance in advance of its initial public offering. Reuters reported Tuesday that lead underwriter Morgan Stanley informed major investors that its analyst had lowered revenue forecasts on Facebook just days before the IPO – information that didn’t reach the investing public. JPMorgan Chase and Goldman Sachs, two other underwriters on the deal, also reduced their estimates around that time.

In one of the more interesting cases during the 2011 Supreme Court term the Court ruled that the Social Security Administration could deny benefits to the children of a deceased father where the children were conceived through in vitro fertilization after the father’s death. The Third Circuit Court of Appeals had previously ruled in the children’s favor, but the Supreme Court reversed the lower court’s decision in a unanimous ruling. Eighteen months after the death of her husband from cancer, Karen Capato gave birth to twins. They had been conceived using Robert Capato’s sperm. Karen applied for the twins to receive Social Security survivor benefits under the theory that the twins were Robert’s biological children and entitled as beneficiaries.

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