Class-Action lawsuit against Zoo Entertainment filed by stockholders
Submitted by Brigitte Lenis
A class-action lawsuit was reportedly recently filed in the Southern District of Ohio against Zoo Entertainment (indiePub Games).
Indeed, the company's stockholders are supposedly accusing the company's executives of issuing "materially false and misleading statements to investors", by overstating net income by up to 660 percent and shareholder equity by over $250 000.
According to Gamasutra, the accusations stem from an April 15, 2011 press release in which Zoo admitted that an internal audit had revealed errors in the company's unaudited consolidated financial statements in 2010. This revelation allegedly caused a plummet of Zoo's stock price by 34.3 percent in one day, from which it has not recovered.
The lawsuit is reportedly seeking unspecified compensatory damages for all investors that held Zoo stock between May 17, 2010 and April 15th 2011.