|
The reserve is intended to cover the estimated
amount of a settlement of class-action litigation initiated on
behalf of investors in Facebook common stock on the date of its
IPO, the company said in a filing related to its financial
results.
Facebook's first day of trading was plagued by technology
problems, resulting in a delayed opening and tens of thousands
of trade and cancellation orders being stuck in Nasdaq's system
for more than two hours.
While market makers lost an estimated $500 million on Facebook's
IPO, federal regulators in 2013 approved a plan for Nasdaq to
repay only about $41.6 million.
However, Nasdaq said on Thursday its reserve would also cover
expected costs of re-opening the company's voluntary
compensation program for firms that lost money due to the issues
during the IPO, but did not submit a claim in 2013. Firms will
be able to submit a claims during the second quarter of 2015,
subject to the same conditions as the claims that were filed in
2013, the company said.
Reopening the compensation program should fully resolve claims
by UBS Group AG's market making arm, Nasdaq said in the filing.
In October, a divided U.S. appeals court rejected UBS's bid to
recoup more than $350 million of losses related to the Facebook
IPO from Nasdaq through arbitration.
Separately, Nasdaq agreed in May 2013 to pay a record $10
million penalty to settle U.S. Securities and Exchange
Commission charges over its alleged "poor systems and
decision-making" for the IPO. The exchange operator did not
admit wrongdoing.
Nasdaq added on Thursday that some or all of amounts paid from
the loss reserve would likely be reimbursed by insurance
coverage.
(Reporting by John McCrank Editing by W Simon)
[© 2015 Thomson Reuters. All rights
reserved.] Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
 |
|
