Three different law firms have filed class action lawsuits against THQ over allegations that the publisher violated federal securities laws with the handling of its failed uDraw
franchise and GameTablet peripherals.
Lawyers have come out of the woodwork to sue THQ in the last week over allegations that the company knowingly made "false and misleading statements" when informing investors about anticipated uDraw
sales for Xbox 360, PlayStation 3, and Wii.
Despite healthy sales for uDraw
's Wii game in early 2011, the company overestimated demand when it attempted to expand the franchise during the holiday season. That error resulted in over $30 million in operating losses
, and THQ eventually killed the series and laid off developers
who worked on the games.
Atlanta law firm Holzer Holzer & Fistel announced last week that it's investigating whether THQ failed to warn investors
in a timely manner about low uDraw sales -- and now three other three firms have filed class action lawsuits making identical allegations.
Class action specialist Robbins Geller Rudman & Dowd, shareholders litigation firm Robbins Umeda, and boutique business and securities law firm Federman & Sherwood have all filed suits against THQ on the behalf of their plaintiffs with the United States District Court for the Central District of California.
All of the firms seek to recover damages for shareholders who purchased THQ stock between May 2011 and February 2012. They are also all encouraging those affected shareholders to contact them and participate in the class action suit.