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Facebook stock: Once hot IPO now a tale of lawsuits, glitches, and overreach (+video)

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Meanwhile, the Wall Street Journal reported Wednesday that three investors have filed a lawsuit regarding that same disclosure issue, and that other lawsuits related to the Facebook IPO are in motion.

The Reuters news service reported Tuesday that Morgan Stanley analyst Scott Devitt cut his estimate for Facebook's revenue this year to $4.85 billion, down from more than $5 billion.

Morgan Stanley, in a statement, did not specifically address which clients might have been told about the reduced estimate. But the firm said that "a significant number" of analysts who track Facebook, including those from other firms underwriting the stock issue, had reduced revenue estimates to reflect publicly available information about the company.

Morgan Stanley also said that revised analyst views were taken into account in setting the stock offering price at $38 per share. The stock "FB" (Facebook's ticker symbol) was trading at about $32 per share on Wednesday.

The Securities and Exchange Commission, the lead regulator of US stock markets, is also looking into the IPO. The agency's chairman, Mary Schapiro, on Tuesday expressed confidence in the "integrity" of US financial markets, but said "there are issues that we need to look at specifically with respect to Facebook."

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