View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. Technology
  2. Data Centre
August 10, 2015

Zynga settles shareholder lawsuit for $23m

Company was accused of keeping shareholders in the dark about business prospects.

By CBR Staff Writer

Zynga has ended litigation which accused the ‘FarmVille’ creators of defrauding shareholders about its business prospects pre and post IPO in 2011.

The company said that it reached the settlement in lieu of $23m, which was reached through mediation.

Zynga said that the incident would not affect the company financially as its insurers would fund the entire payout.

The lawsuit was led by shareholder David Fee who accused the gaming company of hiding declining user activity, and the impact of changes in Facebook’s platform on its games.

The company was also accused ot inflating its 2012 revenue forecast.

Trouble started brewing post IPO, when it started to struggle to create games that were as successful as "FarmVille", and customers dumped the company and got hooked on to "Candy Crush Saga" by rival King Digital Entertainment, reported Bloomberg.

Zynga priced its IPO at $10 per share in 2011, which even went up to $15.91 in March 2012, but later it fell down to $3 less than five months later, which wiped out several billions of dollars of market value.

Content from our partners
Scan and deliver
GenAI cybersecurity: "A super-human analyst, with a brain the size of a planet."
Cloud, AI, and cyber security – highlights from DTX Manchester

Websites in our network
Select and enter your corporate email address Tech Monitor's research, insight and analysis examines the frontiers of digital transformation to help tech leaders navigate the future. Our Changelog newsletter delivers our best work to your inbox every week.
  • CIO
  • CTO
  • CISO
  • CSO
  • CFO
  • CDO
  • CEO
  • Architect Founder
  • MD
  • Director
  • Manager
  • Other
Visit our privacy policy for more information about our services, how Progressive Media Investments may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.