A second class action lawsuit has been opened against Acclaim, again accusing the publisher of misrepresenting its finances and trading situation throughout much of last year and artificially inflating its stock prices.
Earlier this month a very similar suit was filed by US law firm Cauley Gellar on behalf of all those who purchased Acclaim shares between January 11 2002 and September 19 2002 - when the company's released a trading statement revealing the true state of its finances and the poor performance of several key titles.
This new suit, filed by a different firm (Kirby McInerney & Squire) is filed on behalf of anyone who purchased stock between January 22 and September 19, and reads very similarly to the original lawsuit, claiming that Acclaim "materially misrepresented" its financial results "so as to make them seem better than they in fact were, and that such misrepresentations caused Acclaim's stock to trade at artificially inflated prices."
The filing of a second lawsuit could be seen as bad news for Acclaim, as it's unlikely that another firm would jump onto the bandwagon unless it seemed likely that the class action would succeed.
The Kirby McInerney & Squire suit goes on the claim that the publisher "improperly capitalized software development costs and overstated earnings by recording declining allowances for returns and price concessions together with failing to write down receivables despite deteriorating customer quality and increasing delinquent accounts receivables."
Effectively, then, Acclaim stands accused of cooking the books in order to pull the wool over shareholders eyes - and if found guilty, it will be forced to pay damages to all those who purchased its shares during the period covered by the lawsuit, which is a financial blow the currently restructuring publisher could really do without at the moment.
News source: gamesindustry.biz
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