MURRAY FRANK LLP Files Lawsuit Against Zynga Inc.
NEW YORK — MURRAY FRANK LLP announces that it has filed a class action complaint in the United States District Court for the Northern District of California captioned Yan v. Zynga Inc. et al., 12 Civ. 4360. The lawsuit is filed on behalf of purchasers of securities of Zynga Inc. (“Zynga” or the “Company”) between December 16, 2011 and July 25, 2012, inclusive (the “Class Period”).
The lawsuit alleges violations of the Securities Exchange Act of 1934 (the “Exchange Act”) that occurred when the Defendants issued materially false and misleading statements regarding the Company’s business and prospects.Specifically, it is alleged that during the Class Period, Defendants made false and misleading statements about or knew but failed to disclose that (1) the Company’s optimistic financial forecasts were not justified in light of declining users of the Company’s games and declining average bookings per user; and (2) as a result of Defendants’ false and misleading statements, Zynga’s stock traded at artificially inflated prices.On July 25, 2012, Zynga issued a press release in connection with its second quarter 2012 financial results, which were much lower than expected.
The Company revealed that year-over-year quarterly earnings dropped from $0.05 per share to $0.01 per share, and reported a net loss of over $22.8 million. In addition, the Company dramatically reduced its guidance for 2012, citing “delays in launching new games, a faster decline in existing web games due in part to a more challenging environment on the Facebook web platform, and reduced expectations for ‘Draw Something.’” As a result of this disclosure, the market price of Zynga’s common stock dropped nearly 40%, from a close of $5.078 per share on July 25, 2012, to a close of $3.175 per share on July 26, 2012.If you are a member of the class described above, you may move the Court, not later than October 1, 2012, to serve as Lead Plaintiff for the Class.
A Lead Plaintiff is a representative chosen by the Court who acts on behalf of other class members in directing the litigation. You do not need to be a Lead Plaintiff to be included in the class. If you purchased Zynga securities and wish to discuss this litigation, or have any questions concerning this Notice or your rights or interests with respect to these matters, please contact us.
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