Mostly rehash, but a GT response is included. Plus another related story.
From OGR site
January 12, 1998
GT Interactive is just full of news today. Kaufman Malchman Kirby & Squire, LLP - a big time law firm -recently announced that a class action suit is being filed against GT.
The suit alleges that "GT and certain of its officers and directors engaged in a scheme to inflate artificially the market price of GT common stock during the Class Period (August 1, 1996 to December 12, 1997 - ed.), and enable GT insiders to sell their own shares at artificially high prices." The release from Kaufman Malchman Kirby &
Squire goes on to detail some of the ways in which the alleged scheme was carried out.In addition to not complying with "generally accepted accounting principals," the company is being charged with doctoring
its R&D and development costs to make it look as if they had more cash than they actually did. Further, the suit alleges that certain higher ups at GT "misrepresented" the status of products that were discontinued.
A GT Interactive spokesperson had this to say about the lawsuit: "We believe the suit is completely without merit and we intend to defend ourselves vigorously. All of our financial reporting has been well within the GAP(General Accepted Principals). In fact, during the Class Period, we received 2 clean audits.
Other GT related news from OGR :
G.O.D. is creating another world. Recently founded by Mike Wilson, formerly of ION Storm and id, the Gathering of Developers will be formally announcing several new developers under their logo. These include the people responsible for Duke Nukem Forever, Monster Truck
Madness, and Prey. G.O.D. appears to be coming on strong with more announcements (and more details) soon to follow.
Can one interpret this announcement to mean GT has lost 3D Realms as a development source?? They'll fulfill the DN4, DN5 , and Prey deals but will there be any more in the future?? This shouldn't affect earnings this year but could impact on 99 depending on what develops.
Cheers
Bill
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