It's been merely a week since the news broke that EA is being investigated by a US law firm over Battlefield 4; now the publisher is looking down the barrel of more legal trouble. The team behind the infamous Enron lawsuit has commenced a second class-action lawsuit against EA, making similar claims that the publisher made "materially false and misleading statements" regarding Battlefield 4.
On December 17, 2013, Robbins Geller Rudman & Dowd LLP filed a complaint alleging EA violated federal securities laws (specifically, laws introduced by the Securities Exchange Act of 1934) by making said false public statements regarding Battlefield 4 between the period of July 24 and December 4.
The complaint alleges that EA's stock rose based on the purported strength of the Battlefield 4 rollout underway during this period, reaching a high of $28.13 per share by August 23 2013, allowing "certain of Electronic Arts’ senior executives to sell their Electronic Arts stock at artificially inflated prices."
The bug-ridden version of Battlefield 4 on PlayStation 4 is also under investigation. The firm alleges the disclosure of the game's problems lead to a fall in EA's share value, which fell further still once EA placed a hold on all future projects until they were fixed. The complaint alleges EA "recklessly disregarded" the fact that Battlefield 4 was "riddled with bugs and multiple other problems, including downloadable content that allowed players access to more levels of the game, a myriad of connectivity issues, server limitations, lost data and repeated sudden crashes, among other things." As a result, EA "was not on track to achieve the financial results it had told the market it was on track to achieve during the Class Period."
It's important to note that this is still a complaint and the class action itself hasn't been filed; the firm needs a leading plaintiff who bought common stock in EA between July and December to come forward by the motion deadline in 60 days on February 15, 2014, no sure thing.
"We believe these claims are meritless," is the official statement being made to media from EA in regards to the lawsuit. "We intend to aggressively defend ourselves, and we’re confident the court will dismiss the complaint in due course."
You can read the full press release and other details from the law firm
here.
