It looks like Massachusetts is the first to take action over Facebook's seemingly botched initial public offering. The state has fined Morgan Stanley $5 million over the IPO of Facebook, reportedly for violating securities laws that govern how investment research can be distributed.

One of Morgan Stanley's top bankers reportedly improperly coached Facebook on methods to disclose financial information selectively. This, according to William Galvin, continues the trend of creating "an unlevel playing field" between Wall Street and Main Street.

A $5 million fine really is quite tiny in the overall scheme of things. Morgan Stanley will hardly notice the fine, and it's a tiny amount compared to the valuation and money brought in by Facebook's IPO.

"The conduct at Morgan Stanley was more egregious," he said, in reference to a similar charge against Citigroup in late October. "With it we will get their attention and begin to take steps in restoring some confidence for retail investors to invest."

This is just the first of many likely cases against Facebook and the underwriting banks.