After Facebook’s $16 Billion IPO, Company Sued for $15 Billion

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Shannon Stapleton / Reuters

The Facebook logo is seen on a screen inside at the Nasdaq Marekstsite in New York May 18, 2012.

And just like that, Facebook is officially a publicly tradable stock after the company sold over 420 million shares at $38 a pop yesterday to raise $16 billion for its IPO. Also “just like that,” the company’s been sued by some of its users for nearly as much — $15 billion — in a class-action lawsuit accusing the social network of serious privacy violations.

Bloomberg reports that the lawsuit was filed today in San Jose, California federal court, and that it’s actually a mix of 21 individual cases filed by users throughout the country. The gist of the new “super”-lawsuit: It claims Facebook continued to track users, even after they’d logged out of their Facebook accounts.

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David Straite, a partner with the firm representing the plaintiffs, Stewarts Law US LLP, says the lawsuit is more than “just a damages action,” calling it “a groundbreaking digital-privacy rights case that could have wide and significant legal and business implications.”

Facebook’s response? Spokesperson Andrew Noyes calls the lawsuit “without merit” and says his company will “fight it vigorously.”

The lawsuits were originally filed across the U.S., but due to their similarities, a California judicial panel decreed last February that they be rolled into one and the case heard in Facebook’s home state (Facebook is based out of Menlo Park, Calif.). No doubt the lawsuit announcement, as Facebook launched its IPO, was carefully timed.

Facebook has been under the gun for privacy-related issues almost since its inception in 2004. In November 2011, the company settled with the FTC over allegations it had “deceived consumers” by promising to keep their information private, then sharing it publicly anyway. The company has already agreed to independent privacy audits over the next two decades.

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