Investors Can Pursue Del. Suit Over Fund's Facebook Shares

Law360, New York (December 16, 2015, 7:28 PM EST) -- Investors in a fund created to buy Facebook stock before its initial public offering can pursue claims that the vehicle's shares were unfairly doled out amid a criminal scandal, a Delaware Chancery judge ruled Wednesday, saying some investors appear to have gotten numbers of shares disproportionate to their stake in the fund.

Vice Chancellor J. Travis Laster said that Passport Special Opportunities Master Fund LP and other “favored limited partners” in ESG Capital Partners II must face a suit by fellow investors who say they were stiffed in the wake of former ESG chief Timothy D. Burns’ misappropriation of partnership assets...

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