Facebook shareholders sue company over tumbling stocks

After Facebook's multi-billion dollar loss and 19 percent plunge in shares, things do not look bright for the tech giant as its shareholders are now suing the company for damages.

In the first of what could be many lawsuits, Facebook and its CEO Mark Zuckerberg were sued by shareholders who are filing class-action suits and seeking damages. The complaint was filed by James Kacouris in Manhattan federal court, accusing Zuckerberg and Chief Financial Officer David Wehner of making misleading statements about or failing to disclose slowing revenue growth, falling operating margins, and declines in active users.

The fall came after a disappointing announcement about earnings that wiped out about US$120 billion from the company's worth. The debacle has been dubbed the biggest one-day stock drop for any company in the history of the stock market.

The lawsuit seeks class-action status and unspecified damages. Facebook has reportedly refused to comment on the issue.

The social media website is already facing dozens of lawsuits over its handling of user data in the Cambridge Analytica scandal, which allegedly had ties with the Trump Administration and US 2016 Presidential elections.