Judge accepts final settlement in Zynga shareholder class action
Finally some good news for Zynga shareholders!
Not really, but beggers can’t be choosers.
A federal judge has given final approval to Zynga’s settlement of a class action suit brought by shareholders back in 2012. The suit claimed that Zynga executives, including Mark Pincus, concealed user metrics and artificially shifted losses from Q1 of 2012 to a later quarter in order to mask the company’s real financial situation. During that same period, the suit claims, they sold hundreds of millions of dollars of shares before the true state of Zynga was made public, causing its stock price to plummet.
The settlement will pay an estimated average of 15 cents per share to shareholders who held stock during the time of the artificial stock inflation. Zynga has set aside a pool of $23m, all of which will be distributed amongst the claimants. That means, if not every plaintiff chooses to participate in the settlement, the other plaintiffs will receive a larger payout.
The full text of the settlement is below. Zynga went public at $11 a share in 2011. Its stock closed yesterday at $1.83.