Lyft reportedly threatens to sue Morgan Stanley, accuses the bank of supporting short-selling
- Lyft is considering pursuing litigation after it accused Morgan Stanley of supporting short-selling among investors ahead of the company's recent IPO, CNBC reported Saturday.
- The company reportedly sent a letter to Morgan Stanley on April 2, which asked about the firm's possible role in short-selling activities to investors subject to lock-up agreements.
- The letter also reportedly asked Morgan Stanley to turn over relevant materials as Lyft said it has the authority to take legal action on the matter.
Lyft has accused Morgan Stanley of supporting short-selling moves among investors ahead of the company's historic IPO last month, according to CNBC.The company sought answers from Morgan Stanley in an April 2 letter signed by Lyft's counsel Peter Stris that questioned the firm on possible activity that supported investors who are contractually subject to lock-up agreements lodge bets against the company's stock.
CNBC also noted the letter was a response to a New York Post report that cited three sources who said Morgan Stanley supported hedging activities related to Lyft, though the firm said in a statement it flatly denied any such activity.A Morgan Stanley spokesperson also denied these reports to CNBC, saying that the firm "did not market or execute, directly or indirectly, a sale, short sale, hedge, swap or transfer of risk or value associated with Lyft stock for any Lyft shareholder identified by the company or otherwise known to us to be the subject of a Lyft lock-up agreement."
Nasdaq debut, rising to a valuation just over $29 billion on its first day. It was the first ride-share company in history to go public. The IPO was just the beginning of more than 100 tech unicorns, or startups valued at $1 billion or more, that could go public in 2019, including Pinterest, Airbnb, and Lyft's ride-share app rival, Uber.
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