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Facebook sued after disappointing earnings report

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Facebook sued after disappointing earnings report

A Facebook Inc. shareholder filed a class-action suit against the company, CEO Mark Zuckerberg and CFO David Wehner over allegations that they made misleading statements or failed to disclose the true state of the company's revenues and operating metrics, Reuters reported.

The company and its executives were accused of failing to disclose slowing revenue growth and lower operating margins at the company, as well as declines in active users.

The company had reported second-quarter revenue of $13.23 billion, but the amount was lower than expected, leading to a huge sell-off in the stock that wiped out billions in the company's market value. Facebook's shares plunged nearly 19% to close at $176.26 on July 26.

The suit is seeking an unspecified amount in damages.