Class Action Suit Filed

Posts: 7 · New Forum Member Joined: Jan 30, 2005 Posts: 7

BMoore wrote:

I believed in this company to price their stock accordingly... the stock was to reward their loyal customers and unfortunately, they just upset 10,000 of their most loyal customers.

I hope this works out.

The purpose of an IPO is *not* to reward the company's loyal customers. It is to raise cash for the company. Period.

The prospectus, and the vonageipo site, repeatedly warned that the company never made money; would not make money for the forseeable future; and may never make money. Additionally, it warned that Management, the Board, and the Underwriters explicity recommended against the purchase of Vonage shares.

They could not have been more specific in their warnings. The only thing this lawsuit does is drive down the value of Vonage shares even more, and cause it to spend IPO investor money on lawyers to defend itself.

Posts: 4 · Posted: Sat Jun 03, 2006 8:19 am Post subject: Re: The purpose of an IPO

pcapelli wrote:

The purpose of an IPO is *not* to reward the company's loyal customers. It is to raise cash for the company. Period.

You are absolutely correct on that.

However, their intentions to pre-offer the IPO to their loyal customers was to reward them... unfortunately, it backfired. If they knew or felt that the IPO was going to drop, they would have never "pre-offered" the stock to their most loyal customers.

They just should have never offered the IPO to the Vonage customers.

Posts: 7 · New Forum Member Joined: Jan 30, 2005 Posts: 7

BMoore wrote:

However, their intentions to pre-offer the IPO to their loyal customers was to reward them... unfortunately, it backfired. If they knew or felt that the IPO was going to drop, they would have never "pre-offered" the stock to their most loyal customers.

If they knew or felt it would drop; then they should have repriced the offering, or withheld it till a later time. The SEC requires that all shareholders of the same class be treated equally.

They have a large incentive to price the stock as high as possible; because they are trying to raise money for the company, the higher the IPO price, the more money they get.

It was a 'reward' to loyal customers to be offered IPO entry. Thats where the reward ends. Were you expecting a guaranteed profit?

Frankly, from a customer's point of view, if there was a large IPO 'pop', I'd be pissed off because they *underpriced* the offering, leaving money on the table, and weakening their position in the market.

-pete

ps. I was 'rewarded' with an offer to participate. I chose not to, after reading the prospectus, and all the warnings I had to click through on the vonageipo site. Anyone who claims they didn't know they could lose money, completely ignored the 'high risk' part of this 'high return' stock.

Posts: 31 · Vonage Forum Junior Joined: May 21, 2006 Posts: 31

OtisABlock wrote:

How much are you willing to bet that to become party to any potential class-action suit that is filed that you will need to pony up $500 - $1000 in "advance" of any settlement fom Vonage?

This is another falsehood. These class-action type lawsuits do not require a prepayment to participate. The law firms take their fees from the settlement offer they get from Vonage & the underwriters.

Some people have stated that you get nothing from these type of lawsuits, and while that may be the case most of the time. I can tell you that I have personally been sent a big check on a previous IPO debacle.

It costs you nothing to join the class - if you feel you were wronged.

Posts: 1 · New Forum Member Joined: Jun 03, 2006 Posts: 1

I have been a customer of Vonage since the early days. I received the stock offer, read over it many times and then decided not to participate because they admitted that the stock prices were libel to drop and I could not afford to take that chance in my finances. However, now that the price has dropped and may drop even more due to this lawsuit, I will wait until this lawsuit has been dismissed and buy some stock for the long term. As others have said already, anyone who claims that they didn't know that the IPO stock might lose value, was obviously already thinking about spending their profits instead of reading and (thinking) about the risks involved. I feel bad for the people who lost money in the IPO. But as someone who has made more than one bad investment in their lifetime, that is the chance you take. If these people had made a ton of money, then they wouldn't be complaining, or they would be complaining that they couldn't buy more stock than they did. Stocks (like life) is a risky business, you take the good with the bad.

Posts: 57 · Full Forum Member Joined: Sep 03, 2005 Posts: 57

Jlridge and dumbdog, you both said it well. My advice to you is not to wast your breath. This stockboard is a Whiners club. I first had sympathy for them, now I think they are pittyful.

Dconner, the owner of this board, (if evrything he said was true), had purchased thousands of shares and is still continue to purchase shares while VG continues to slide. To me Dconner is losing the most money here than any of these whiners, but I don't hear him making all kinds of excuses.

Greed got in the way of better judgement for these people. End of the story. Believe me, no matter what the stock had done, these people here will whine. Like you said and I said it before, if this stock is at $40 today, this would never be a issue. Nobody would give a hoot when they "saw" the shares in their accounts. And they will whine about not getting enough shares.

Posts: 3 · New Forum Member Joined: Aug 05, 2005 Posts: 3

Quote:

Jlridge and dumbdog, you both said it well. My advice to you is not to wast your breath. This stockboard is a Whiners club. I first had sympathy for them, now I think they are pittyful.

I just can't understand anyone's refusal to pay for their shares. If they believe they have been wronged, deceived, cheated, manipulated, whatever, take it to court. They STILL have an obligation to pay in full NOW, and let the court decide. At least show good faith and put the money in escrow until the dispute is resolved. To do otherwise makes them no better than what they are accusing Vonage and the underwriters of.

Posts: 5 · New Forum Member Joined: May 24, 2006 Posts: 5

OtisABlock wrote:

Bwahahahahahahaha! You think these bottomfeeders have a case? Not a chance in h-e-double-hockey-sticks. Do you know what this is? These guys see a schooling pack of suckers and want to drain your wallets of more money. How much are you willing to bet that to become party to any potential class-action suit that is filed that you will need to pony up $500 - $1000 in "advance" of any settlement fom Vonage? Figure that even if 1% of you fools to kick in $1000 that a firm can do $10,000 worth of billable hours and pocket nearly a quarter million once the case is thrown out.

Cowboy UP!

You are just a little bit misinformed. Class action suits are based on contingency 99% of the time. Funny how if you word something right with enough emotion, it almost sounds like you know what you are talking about

Posts: 13 · Vonage Forum Associate Joined: May 23, 2006 Posts: 13

btrader wrote:

rudedog40 wrote:

I see it going all the way to the US Supreme Court before it gets resolved.

LOL - you have to be the least informed person on this board.

He might have been a little sarcastic here.

Posts: 80 · Vonage Forum Senior Joined: May 24, 2006 Posts: 80

jlridge wrote:

I just can't understand anyone's refusal to pay for their shares. If they believe they have been wronged, deceived, cheated, manipulated, whatever, take it to court. They STILL have an obligation to pay in full NOW, and let the court decide. At least show good faith and put the money in escrow until the dispute is resolved. To do otherwise makes them no better than what they are accusing Vonage and the underwriters of.

My sentiment exactly.
When ordering shares in the IPO, investors agreed to purchase shares at $17, and the fact that the stock declined after it started trading does not change that situation in any way.

I feel for everyone who lost money on Vonage, but the only right thing to do is to pay for the shares allocated.