Twitter has been sued for $124 by Precedo Capital Group and Continental Advisors for allegedly influencing the firms to ‘fix’ a private sale of company’s shares to boost investor interest prior to its initial public offering and then cancelled it.
The micro-blogging site has also been accused of using the terminated sale as a way to offer the money-losing firm a $10bn market valuation.
Both firms said in their lawsuit: "Twitter never intended to complete the offering on behalf of Twitter stockholders, in the private market, thereby causing substantial damages to the plaintiffs in the loss of commissions, fees and expenses, as well as through their business reputation."
Further, the financial firms are seeking about $24.2m of compensatory damages, $100m of disciplinary damages and other remedies.
Twitter spokesman said that the company never had a relationship with these plaintiffs.
"Their claim is completely without merit," spokesman said.
In September 2013, Twitter filed a Form S1 to with the US Securities Exchange Commission (SEC) for its planned IPO, while has also sought $1bn loan ahead of IPO
