Former Zynga Manager Sues Company Over Stock Sales

April 9, 2013 -

A lawsuit filed by a former Zynga product manager claims that non-executive level employees were not allowed to sell stock in the company after Zynga's IPO in 2011 for 165 days, even as executives cashed out early. Former employee Wendy Lee goes on to claim that the 165 day window was lifted for executives, who doubled the proceeds from their sale of stock, while regular employees took sharp losses as Zynga's stock priced plummeted. By the time Lee was allowed to sell her shares Zynga's dropped by 49.3 percent. Her 30,000 shares for $3.15 each, down from the $3.805 per share she paid.

Lee is asking the Delaware court to order Zynga executives who cashed out to pay damages to non-executive shareholders who lost out because of the lock-up. Gamasutra has contacted Zynga for a response to the lawsuit.

Prior to Zynga's IPO, some employees alleged that CEO Mark Pincus demanded that they return their stock to the company. The case was filed in the Delaware court under Lee v. Pincus, CA8458, (Delaware Chancery Court - Wilmington). We'll have more on this story as it develops.

Source: Bloomberg by way of Gamasutra

 

 


 
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