Two class action lawsuits have been filed against Vonage, alleging that the company filed a misleading S-1 with SEC. In a lawsuit, Lockridge Grindal Nauen alleges that “both the Company and Company insiders were losing money, and these insiders, desperate to execute an exit strategy for themselves, embarked on an illegal course of conduct to sell shares of the Company in a public market.”
The complaint also alleges that Vonage’s decision to pre-sell 13.5% of the Vonage IPO shares to customers is in violation of NASD Rule 2310. Pomerantz Haudek Block Grossman & Gross, in a class action suit filed last week, makes similar contention. Vonage stock is now trading at $8.59 a share, down from its IPO offering price of $17 a share.