NEW YORK (Reuters) – The US Department of Justice and the Securities and Exchange Commission have announced Snap Inc ( SNAP.N ) for information about its first public offer in March 2017, social media app maker Reuters told Tuesday.
A man takes a photo on the front of the New York Stock Exchange (NYSE) with a Snap Inc. logo that hung on the front of it just before the company’s launch in New York, USA, March 2, 201
7. REUTERS / Lucas Jackson
Snap said in a statement it has responded to court judgments and other requests for information.
The previously reported federal inquiries follow an ongoing shareholder right in which investors claim that Snap misled the public about how the competition from Facebook Incs ( FB.O ) Instagram service had affected company growth.
Snap said that it considers that the federal regulatory authorities “investigate issues relating to the previously alleged claims claimed in the class action of our IPO disclosures.”
It continued: “Although we do not have full visibility in these surveys, our understanding is that DOJ is likely to focus on Instagram competition IPO data.”
Snaps Snapchat message board has struggled with user development since the IPO and, despite Expected sales growth and declining losses, the shares have tummies. They closed at $ 6.71 on Tuesday, down from their original offer price of $ 17.
The company described the trial as “meritless” and its pre-IPO disclosures as “accurate and complete.” It said it would continue to cooperate with the SEC and the Justice Department.
Snap confirmed probes after the US government made a sealed application in the mood last Wednesday.
The process filed in May 2017 at the United States District Court in Los Angeles also claims that Snap did not disclose a sealed trial brought before the IPO, where a former employee claimed that the company had distorted certain user values.
Judge Stephen V. Wilson in June denied Snap’s motion to reject the case.
Reporting by Alison Frankel in New York; Further Reporting by Paresh Dave in San Francisco; Editing Cynthia Osterman
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