Online video firm Blinkx has complained to a financial regulator in the UK that it may have been the victim of market manipulation, the Financial Times reported. Last week, Blinkx lost one third of its value after a blog post was published by Harvard Business School Professor Benjamin Edelman. The post raised questions about the company's strategies of getting advertising revenue. The study was apparently financed by investors who could have gained from the subsequent decline in Blinkx's shares, the report said.

People with knowledge of the situation told FT that the Financial Conduct Authority has gotten complaints from Blinkx and other parties. One of the people added that the regulator has started to evaluate the complaints but an official investigation has not been started yet, the report said.

Edelman's post entitled "The dark side of Blinkx" asked questions on how the firm gets traffic for its content and the links it had with Zango and AdOn which are adware firms. In the past few weeks, investors have tried to profit from the decline in the company's share price by shorting its stock, the report said.

However, legal experts told FT that the FCA could legitimately consider certain questions about the case while one former regulatory official said the situation could be a potentially "trash and cash" strategy.The focus would now turn on the investors who supported Edelman's study and if they already had short positions open knowing that critical information would unveiled. This would be market abuse, the report said.

London-based Taylor Wessing lawyer Shane Gleghorn told FT, "If the short positions were purchased in the knowledge that this information - assuming that information was not available to the market - was going to be released and affect the share prices, that looks like risky conduct. If the short positions were purchased before the investors became aware that this information was to be disseminated, and such information was true and available market information, the position is less clear cut and it may be that the conduct is defensible."