E-Commerce Times Talkback
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Defunct e-tailer eToys became the latest company that will have to face off against
shareholders in court, as investors filed a class action lawsuit alleging that the former
online toy seller's initial public offering (IPO) prospectus was "materially false and
Specifically, the suit charges that a portion of the e-tailer's IPO registration
statement, which was filed with the U.S. Securities and Exchange Commission (SEC), did not disclose that
Goldman Sachs, Robertson Stephens and Merrill Lynch had "solicited and received
excessive and undisclosed" commissions from certain investors.
In exchange for these commissions, the action said, the investment firms
allocated to their customers "material portions" of the restricted number
of eToys IPO shares.
How come the shareholders of eToys have not received fair value of the assets purchased by KB Toys?
Millions of dollars were exchanged and the shares remained where they were. Does the lawsuit give the shareholders back the equivalent value for the assets purchased by KB Toys, which now uses the whole concept of eToys all over again. The shareholders of eToys are now seeing what they originally invested in...eToys.com up and running and yet their shares have no value? Where is the Justice in that? Where is the SEC or NASD when we need them?
Class action lawsuiters got no class at all.
Classless? What would you call the management of a firm that waits until they only have 3 months worth of cash remaining before they notify investors? In this case - probably millionaires.
When I was 12 I saw 50 or so ppl strangers, neither friends nor acquaintances, crassly ripping my grandmother's home and her belongings apart when she died.
Things she worked hard for, a collection of memories she cherished and was building upon.
I remember the faces of some of these ppl. They looked liked they were owed something more as they happen to gaze upon what was to be a family heirloom of ours. Eyes feverishly fixed for the first time and demanded that they would not pay more than 5 dollars for something that took my grandmother a lifetime to design and just as long to find the right ppl to make, let alone bring home finally.
Watching this whole story from start to finish reminded me, -it was a gut wrenching ride. Living through it from the sideline sickened me.