Zynga is being sued by a shareholder peeved that executives were allowed to sell stock early for more than $200 million, while sales by lower level employees and outsiders were blocked. The suit, filed by former Zynga product manager Wendy Lee, said that following an initial public offering in December 2011, shareholders were barred from selling shares for 165 days.
The contention by Lee is that this stipulation was waived for certain executives, who sold more than 40 million shares in March 2012 for more than $200 million. This may not have been so bad except for the fact that the share price was cut in half by the time the lockup expired.
Lee wants damages from those who benefited from the early sales on behalf of non-executive shareholders — CEO Mark Pincus in particular is named.
Source: Bloomberg
