Felix Investments, a New York-based investment firm that began investing in Facebook employee shares in 2009 via two funds – Facie Libre 1 and Facie Libre II – has filed a lawsuit against SecondMarket in New York State Supreme Court.
The suit alleges that Felix struck a deal in January 2010 to buy 75,000 shares of Facebook software engineer Karl Voskuil at a price of $33 per share, for a total of $2,475,000, after Facebook didn’t exercise its right of first refusal.
Felix has worked extensively with SecondMarket, the suit suggests, and believed the deal to be done, even informing its investors that Felix had obtained the shares last March. What the firm didn’t know at the time, it says in the suit, is that SecondMarket had failed to obtain a legal opinion for the Facebook shares within 60 days from when Voskuil notified Facebook of his intent to sale, instead missing the deadline by one day. Felix claims in its suit that it tried to “re-start” the 60-day window, but by April of last year, Facebook had instituted a new insider trading policy that kept Voskuil from selling the agreed-upon shares.
The suit claims Voskuil returned $2.4 million to Felix in March of this year, an amount representing the purchase price, minus a $75,000 fee paid to SecondMarket, which typically collects three percent of a transaction. The suit is seeking damages, including what it’s claiming is a lost profit of $9.5 million. (According to Facebook’s current, $70 billion valuation on SecondMarket, Voskuil’s 75,000 shares would be worth $12 million today. When Voskuil, through SecondMarket, transacted with Felix in January 2010, Facebook’s valuation was an estimated $14 billion.)
News of the suit was first reported by DealFlow Media.
Asked for comment this morning, SecondMarket wrote us in an email that, “We believe this lawsuit is without merit, and we have no further comment at this time.”
A request for comment to Felix Investments has not yet been returned.
Felix Investments was formed by two former executives from Advanced Equities Financial, the Chicago-based investment bank, and calls itself “a boutique venture capital/private equity broker dealer located on Wall Street.” The firm is among numerous others that have specifically raised funds targeted at procuring Facebook shares before it becomes a publicly traded company.
Felix’s funds, Facie Libre I and Facie Libre II – ostensibly mean “Face Book” in Latin.