Earlier this week we reported that the Nasdaq stock exchange had set aside $40 million to compensate investors who were hurt financially by the computer glitch that plagued Facebook trading early on during the IPO launch. You might recall, the glitch left big bank trading desks blind to who bought what and at what price.

UBS was one of the investors who was effected by the glitch. The problem is, they lost over $350 million on the deal. It stems from Nasdaq’s failure to confirm their Facebook trades. Originally they wanted a million shares, but after not getting confirmation, they repeatedly entered their order. Of course, in the end, they ended up with far too many shares–one million for each time they entered their order.

According to CNBC, UBS is preparing a lawsuit against the Nasdaq for damages stemming from glitch. Officially UBS doesn’t disclose their losses until the end of a financial quarter. They also say they are exploring other options for recouping the funds.

UBS comments on the loses incurred from Nasdaq trading during Facebook’s IPO launch:

“Consistent with our policy on market comments on our positions or intra-quarter performance, we are not disclosing the amount of the loss, which is not material to UBS,”

“We are continuing to consider avenues to recover our losses in this matter, but have not yet taken legal action.”

Yesterday, the compensation plan devised by Nasdaq was met with huge criticism by big investors who called it a scam and an attempt to turn a confidence eroding event into a competitive advantage. Of course, by now you probably know this is not the first party to take legal action against the Nasdaq for the computer glitch.

We’ll have to wait and see what happens with all this hubbub caused by the glitch, but I’m not sure the courts will find Nasdaq responsible. I would have thought issues like UBS experienced would have been dealt with by the end of the first day of trading on May 18th. I guess progress is slow. We’ll keep you posted.