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eToys Suing Goldman Sachs For Underpricing IPO
from the oh-come-on dept
Here's more proof that there's always someone with deep pockets you can sue. What's left of eToys is now suing Goldman Sachs for underpricing their IPO. eToys is saying that GS underpriced the IPO so that it would pop on the first day, while they received kickbacks from customers they allocated shares to. For years, I've been wondering why all the companies that had a huge first day run up didn't complain to their banks. While it made big news and companies seemed to think it meant they were a hit - it actually meant that they left many millions of dollars on the table. Of course, why it took eToys 3 years to realize this is certainly an open question.
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Ironic
The irony is that eToys took less than two years to go from allegedly-underpriced IPO to bankruptcy. In fact, if I were Goldman Sachs, that would be my defense: if anything, it was priced too high.
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