• Abstract and Figures
• Public Full-text

Case 2:12-cv-05227-GAF-JEM Document 1 Filed 06/15/12 Page 1 of 36 Page ID #:5 1 ROBINS OBLLER RUJDMAN & DOWD LLP 2 DARkEN J. ROBBNS (168593) 2U;2JLr!!s 28 DAVID C. WALTON (167268 OLE 3 655 West Broadway Suite 190 Jr OF CLlF San Diego, CA 921 SANT4 MiA 4 Telephone: 619/231-1058 619/231-7423 (fax) 5 [email protected] davewrgrd1aw. corn 6 - and - SAMUEL H. RUDMAN 7 MARIO ALBA JR. 58 S Service Road, Suite 200 8 Melville, NY 11747 Telephone: 631/367-7100 9 631/67-1173 (fax) srudman®rgrdlaw.com 10 [email protected] 11 Attorneys for Plaintiff 12 [Additional counsel app oar on signature page.] 13 UNITED STATES DISTRICT COURT 14 CENTRAL DISTRICT OF CALIFORNIA 15 SOUTHERN DIVISION 16 KHALIL ZAGHIAN, Individually and VIA FA12 on Behalf of All Others Similarly - 5227 GAl? (JEM) 17 Situated, No. 18 Plaintiff, CLASS ACTION 19 Vs. COMPLAINT FOR VIOLATION OF THE FEDERAL SECURITIES LAWS 20 THO INC. BRIAN J. FARR:ELL and PAUL J. PUCINO, 21 Defendants. 22 DEMAND FOR JURY TRIAL. 23 24 25 26 27 28 2:12-cv-05227-GAF-JEM Document 1 Filed 06/15/12 Page 2 of 36 Page ID #:6 1 Plaintiff alleges the following based upon the investigation of plaintiff's 2 counsel, which included a review of United States Securities and Exchange 3 Commission ("SEC") filings by THQ Inc. ("THQ" or the "Company"), as well as 4 regulatory filings and reports, securities analysts' reports and advisories about the 5 Company, press releases and other public statements issued by the Company, and 6 media reports about the Company, and plaintiff believes that substantial additional 7 evidentiary support will exist for the allegations set forth herein after a reasonable 8 opportunity for discovery. 9 JURISDICTION AND VENUE 10 1. The claims asserted herein arise under and pursuant to § § 10(b) and 20(a) 11 of the Securities Exchange Act of 1934 ("Exchange Act") [15 U.S.C. § §78j(b) and 12 78t(a)J and Rule lob-S promulgated thereunder by the SEC [17 C.F.R. §240.10b-5]. 13 2. This Court has jurisdiction over the subject matter of this action pursuant 14 to 28 U.S.C. §1331 and §27 of the Exchange Act. 15 3. Venue is proper in this District pursuant to 28 U.S.C. § 1391(b), because 16 defendants maintain an office in this District and many of the acts and practices 17 complained of herein occurred in substantial part in this District. 18 4. In connection with the acts alleged in this complaint, defendants, directly 19 or indirectly, used the means and instrumentalities of interstate commerce, including, 20 but not limited to, the mails, interstate telephone communications and the facilities of 21 the national securities markets. 22 NATURE OF THE ACTION 23 5. This is a federal securities class action on behalf of purchasers of the 24 common stock of THQ between May 3, 2011 and February 3, 2012, inclusive (the 25 "Class Period"), seeking to pursue remedies under the Exchange Act. 26 27 28 - 1 - 2:12-cv-05227-GAF-JEM Document 1 Filed 06/15/12 Page 3 of 36 Page ID #:7 1 PARTIES 2 6. Plaintiff Khalil Zaghian, as set forth in the accompanying certification 3 and incorporated by reference herein, purchased the common stock of THQ during the 4 Class Period and has been damaged thereby. 5 7. Defendant THQ develops, publishes, and distributes interactive 6 I entertainment software for various game systems, personal computers ("PC"), 7 wireless devices, and the Internet. 8 8. Defendant Brian J. Farrell ("Farrell") was, at all relevant times, Executive 9 Chairman, Chief Executive Officer and President of THQ. 10 9. Defendant Paul J. Pucino ("Pucino") was, at all relevant times, Chief 11 Financial Officer and Executive Vice President of THQ. 12 10. The defendants referenced above in ¶8-9 are referred to herein as the 13 I "Individual Defendants." 14 11. During the Class Period, the Individual Defendants, as senior executive 15 officers and/or directors of THQ, were privy to confidential and proprietary 16 information concerning THQ, its operations, finances, financial condition and present 17 and future business prospects. The Individual Defendants also had access to material 18 adverse non-public information concerning THQ, as discussed in detail below. 19 Because of their positions with THQ, the Individual Defendants had access to non- public information about its business, finances, products, markets and present and 21 future business prospects via internal corporate documents, conversations and 22 connections with other corporate officers and employees, attendance at management 23 and/or board of directors meetings and committees thereof and via reports and other 24 information provided to them in connection therewith. Because of their possession of 25 such information, the Individual Defendants knew or recklessly disregarded that the 26 adverse facts specified herein had not been disclosed to, and were being concealed 27 from, the investing public. 28 -2- 12-cv-05227-GAF-JEM Document 1 Filed 06/15/12 Page 4 of 36 Page ID #:8 1 12. The Individual Defendants are liable as direct participants in the wrongs 2 complained of herein. In addition, the Individual Defendants, by reason of their status 3 as senior executive officers and/or directors, were "controlling persons" within the 4 meaning of §20(a) of the Exchange Act and had the power and influence to cause the 5 Company to engage in the unlawful conduct complained of herein. Because of their 6 positions of control, the Individual Defendants were able to and did, directly or 7 indirectly, control the conduct of THQ's business. 8 13. The Individual Defendants, because of their positions with the Company, 9 I controlled and/or possessed the authority to control the contents of its reports, press 10 releases and presentations to securities analysts and through them, to the investing 11 public. The Individual Defendants were provided with copies of the Company's 12 reports and press releases alleged herein to be misleading, prior to or shortly after their 13 issuance and had the ability and opportunity to prevent their issuance or cause them to 14 be corrected. Thus, the Individual Defendants had the opportunity to commit the '51 fraudulent acts alleged herein. 16 14. As senior executive officers and/or directors and as controlling persons of '71 a publicly traded company whose common stock was, and is, registered with the SEC 18 pursuant to the Exchange Act, and was, and is, traded on the NASDAQ Stock Market 19 ("NASDAQ") and governed by the federal securities laws, the Individual Defendants 20 had a duty to promptly disseminate accurate and truthful information with respect to 21 THQ's financial condition and performance, growth, operations, financial statements, 22 business, products, markets, management, earnings and present and future business 23 prospects, and to correct any previously issued statements that had become materially 24 misleading or untrue, so that the market price of THQ common stock would be based 25 upon truthful and accurate information. The Individual Defendants' 26 misrepresentations and omissions during the Class Period violated these specific 27 requirements and obligations. 28 -3- 12-cv-05227-GAF-JEM Document 1 Filed 06/15/12 Page 5 of 36 Page ID #:9 1 15. The Individual Defendants are liable as participants in a fraudulent 2 scheme and course of conduct that operated as a fraud or deceit on purchasers of THQ 3 common stock by disseminating materially false and misleading statements and/or 4 I concealing material adverse facts. The scheme: (i) deceived the investing public 5 I regarding THQ's business, operations and management and the intrinsic value of THQ common stock; (ii) enabled the Company to enter into a credit facility whereby the 7 I Company could borrow up to $75 million in capital; and (iii) caused plaintiff and 8 I members of the Class to purchase THQ common stock at artificially inflated prices. 9 CLASS ACTION ALLEGATIONS 10 16. Plaintiff brings this action as a class action pursuant to Federal Rule of 11 Civil Procedure 23(a) and (b)(3) on behalf of a class consisting of all persons or 12 entities who purchased the common stock of THQ during the Class Period (the 13 "Class"). Excluded from the Class are defendants and their families, the officers and 14 directors of the Company, at all relevant times, members of their immediate families 15 and their legal representatives, heirs, successors or assigns and any entity in which 16 defendants have or had a controlling interest. 17 17. The members of the Class are so numerous and geographically dispersed 18 I that joinder of all members is impracticable. THQ stock was actively traded on the 19 NASDAQ. While the exact number of Class members is unknown to plaintiff at this 20 time and can only be ascertained through appropriate discovery, plaintiff believes that 21 there are hundreds of members in the proposed Class. Record owners and other 22 members of the Class may be identified from records maintained by THQ or its 23 transfer agent and may be notified of the pendency of this action by mail, using the 24 form of notice similar to that customarily used in securities class actions. 25 18. Plaintiff's claims are typical of the claims of the members of the Class as 261 all members of the Class are similarly affected by defendants' wrongful conduct in 27 violation of federal law that is complained of herein. A Case 2:12-cv-05227-GAF-JEM Document 1 Filed 06/15/12 Page 6 of 36 Page ID #:10 1 19.

Load more

  36

Copy Link