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Vonage's stock debuted on the NYSE on May 24, but had lackluster results

The problems for Vonage seem to just keep piling up.  The company recently went public on the New York Stock Exchange (NYSE), but has taken a severe beating after shares dropped around 30%.  It has now been reported that a class-action lawsuit has been filed against the company in the U.S. District Court in New Jersey.

The lawsuit by South Carolina-based Motley Rice accuses Vonage of improperly selling shares to customers and violating securities laws.  The securities law "requires that a company recommending the purchase or sale of its securities to a customer must have a reasonable basis for believing that the recommendation is suitable for the customer."

Because Vonage set aside a portion of its shares for customers to buy, the company also realized that institutional investors who normally buy IPOs would most likely not be willing to purchase shares at the stated price.  Some shareholders are now threatening to not pay for the shares they were allocated by Vonage.  The IPO price of Vonage stock when it was first introdyced was $17 -- however, the stock closed at $12.32 on Monday evening after a brief rebound.




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