Judge Dismisses Lawsuit Against SeaWorld
April 12 2016 - 2:30PM
Dow Jones News
ORLANDO, Fla.--A judge in southern California has dismissed a
securities-fraud lawsuit brought by investors in SeaWorld
Entertainment, Inc. who claimed company officials misled them about
the impact of the documentary "Blackfish" on the company's
financial performance and attendance at its parks.
U.S. District Judge Michael Anello said the investors failed to
show that SeaWorld officials had deliberately made false
statements, that "Blackfish" alone caused attendance declines and
that SeaWorld officials knew "Blackfish" had caused attendance
declines.
The lawsuit was brought by pension retirement programs for
Arkansas state workers and Danish workers on behalf of all
investors who had purchased shares in the company after its initial
public offering in April 2013 until August 2014.
The documentary chronicled the life of SeaWorld's killer whale,
"Tilikum," who has been linked to the deaths of three people,
including SeaWorld trainer Dawn Brancheau. The film suggested that
captivity provokes mental distress and violent behavior in the
enormous marine mammals. Attendance declined after the film's
release.
"As currently pleaded, plaintiffs' attendance allegations are
insufficient to demonstrate that a material misrepresentation or
omission regarding Blackfish caused attendance to decline at all
SeaWorld Entertainment parks," the judge wrote in his March 31
order.
SeaWorld Entertainment not only runs three SeaWorld parks in
Orlando, San Diego and San Antonio, but also two Busch Garden
parks, three water parks, a marine mammal interactive park and
Sesame Place park.
SeaWorld doesn't typically comment on pending litigation, "but
we are pleased with the Court's decision to dismiss the case at
this stage," said SeaWorld spokeswoman Aimé e Jeansonne Becka.
The investors claimed in their lawsuit that materials SeaWorld
filed with the U.S. Securities and Exchange Commission before its
initial public offering in April 2013 were false since they failed
to acknowledge the allegations made in the documentary. They also
said that then-CEO James Atchison and other SeaWorld executives
made false statements when they attributed quarter-to-quarter
attendance declines to bad weather, a new pricing strategy and
changes on the calendar for spring break and Easter, instead of
blaming "Blackfish." The investors said competitors Universal
Studios and Disney faced similar challenges and saw attendance
increases.
But the judge said SeaWorld can't be compared to the other
theme-park companies since their parks are in different cities, and
that weather may affect SeaWorld more than the other parks because
animals are involved. The Disney and Universal parks also had new,
high-profile expansions that SeaWorld lacked, he said.
In the past year and a half, several of SeaWorld's top
executives named in the lawsuit, including Atchison, have left the
company.
New CEO Joel Manby said last month that SeaWorld was ending its
killer-whale breeding program and that it would soon stop using
killer whales for theatrical performances. Mr. Manby said society's
view of killer whales in captivity had shifted and SeaWorld's
decision reflected that change.
Copyright 2016 Associated Press
(END) Dow Jones Newswires
April 12, 2016 14:15 ET (18:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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