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| APRIL 18, 2008 |
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HOT COFFEE ANYONE?
Judge dismisses some claims against
Take-Two
Judge dismisses some claims against
Take-Two
While the plaintiffs will be allowed to replead their case by submitting an amended suit, the
ruling by U.S. District Judge Shirley Wohl Kram in Manhattan found that the current claims did
not adequately show that the company intended to deceive investors about the hidden
content in its "Grand Theft Auto: San Andreas" game.
Take-Two is currently trying to fend off a $2 billion hostile buyout bid by rival Electronic Arts.
Take-Two, which has new management after a shareholder coup, has been shaken by
accounting scandals related to its stock option awards practices and controversy over its
games. It is holding its annual meeting on Thursday.
The securities fraud suit, brought in 2006, accused Take-Two of misrepresenting its
compliance with the rules of the video game industry's rating board when submitting the "San
Andreas" title for review, as well as issuing false statements about its option awards
practices.
Last year, former Take-Two Chief Executive Ryan Brant pleaded guilty to criminal charges
over backdating options. Other top executives also pleaded guilty.
In a written ruling on Wednesday, Judge Kram said the investors' backdating case could
move forward, but she said that in one instance the plaintiffs did not adequately show a link
between the fall in the company's stock price and the alleged misrepresentations by
Take-Two. The rejection of the alleged link could ultimately limit the plaintiffs' damage claims.
"We are pleased with the judge's ruling, which dismissed without prejudice the plaintiff's
claims regarding Grand Theft Auto: San Andreas and narrowed the scope of the options
backdating case," Take-Two said. "We continue to believe that the remaining claims are
without merit and we will continue to defend against them."
A lawyer for the plaintiffs did not return a phone call requesting comment.
Take-Two announced in November that it had reached a preliminary settlement in a separate
consumer lawsuit brought over the hidden content in the "San Andreas" game.
ruling by U.S. District Judge Shirley Wohl Kram in Manhattan found that the current claims did
not adequately show that the company intended to deceive investors about the hidden
content in its "Grand Theft Auto: San Andreas" game.
Take-Two is currently trying to fend off a $2 billion hostile buyout bid by rival Electronic Arts.
Take-Two, which has new management after a shareholder coup, has been shaken by
accounting scandals related to its stock option awards practices and controversy over its
games. It is holding its annual meeting on Thursday.
The securities fraud suit, brought in 2006, accused Take-Two of misrepresenting its
compliance with the rules of the video game industry's rating board when submitting the "San
Andreas" title for review, as well as issuing false statements about its option awards
practices.
Last year, former Take-Two Chief Executive Ryan Brant pleaded guilty to criminal charges
over backdating options. Other top executives also pleaded guilty.
In a written ruling on Wednesday, Judge Kram said the investors' backdating case could
move forward, but she said that in one instance the plaintiffs did not adequately show a link
between the fall in the company's stock price and the alleged misrepresentations by
Take-Two. The rejection of the alleged link could ultimately limit the plaintiffs' damage claims.
"We are pleased with the judge's ruling, which dismissed without prejudice the plaintiff's
claims regarding Grand Theft Auto: San Andreas and narrowed the scope of the options
backdating case," Take-Two said. "We continue to believe that the remaining claims are
without merit and we will continue to defend against them."
A lawyer for the plaintiffs did not return a phone call requesting comment.
Take-Two announced in November that it had reached a preliminary settlement in a separate
consumer lawsuit brought over the hidden content in the "San Andreas" game.
NEW YORK (Reuters) - A judge has dismissed
several claims accusing Take-Two
Interactive Software Inc of misleading
shareholders about an installment of its
popular "Grant Theft Auto" video game that
contained hidden sex scenes and caused
a consumer uproar.
several claims accusing Take-Two
Interactive Software Inc of misleading
shareholders about an installment of its
popular "Grant Theft Auto" video game that
contained hidden sex scenes and caused
a consumer uproar.