According to a press release dated March 4, 2010, the complaint alleges that on February 10, 2010, EGC postponed a conference call, which was slated to discuss important internal issues at the Company. The postponement resulted in an immediate sixteen percent drop in stock price. On February 19, 2010, Electronic Game Card, Inc. ("EGC") announced that: (a) its independent auditors withdrew its audit opinions for EGC's financial statements for the years ended December 31, 2006, 2007, and 2008; and (b) its financial reporting for the years ended December 31, 2006, 2007, and 2008 as well as its quarterly reports for its first three quarters of 2009 needed to be adjusted and reissued. Also on February 19, 2010, the United States Securities and Exchange Commission halted trading in EGC securities. As a result, class members have suffered substantial damages and their shares are currently illiquid.
On June 4, 2010, Judge David O. Carter granted the motion to consolidate two related actions under the lead docket. The Lee Group was approved as lead plaintiff and the lead plaintiff’s selection of lead counsel. On September 13, 2010, the lead plaintiff filed a Consolidated Amended Complaint, which named certain company directors as additional defendants in the action.
On September 29, 2010, the company defendant filed a disclosure suggestion of bankruptcy. On October 20, November 8 and November 11, 2010, the individual defendants filed motions to dismiss the case.
According to the Order, signed by Judge David O. Carter on January 12, 2010, the Moving Defendants’ Motions to Dismiss are granted with respect to Plaintiffs’ claims under Section 10(b) of the Securities and Exchanges Act of 1934 and SEC Rule 10b-5. The Court hereby orders that these claims be dismissed with leave to amend. Moving Defendants’ Motions to Dismiss are denied with respect to Plaintiffs’ claims under Section 20(a) of the Securities and Exchanges Act of 1934. Plaintiffs’ shall file any amended complaint no later than February 16, 2011.
On February 11, 2011, the plaintiff filed a Consolidated Second Amended Class Action Complaint. The defendants responded by filing a motion to dismiss the Consolidated Second Amended Class Action Complaint on March 14, 2011. On May 26, 2011, Judge David O. Carter granted the motion to dismiss Plaintiffs' Section 10(b) claim. The dismissal is with leave to amend. Plaintiffs shall file any amended complaint no later than June 17, 2011.
On August 29, 2011, several motions for judgment on the pleadings were filed. On October 19, 2011, Judge David O. Carter granted the defendants' motion for judgment on the pleadings and motion to dismiss the Second Amended Complaint. Plaintiffs shall file any amended complaint no later than November 21, 2011.
On November 21, 2011, the plaintiff filed a Consolidated Third Amended Complaint. The defendants have filed several motions to dismiss the Consolidated Third Amended Complaint, which is currently pending before the Court.
On March 6, 2012, Judge David O. Carter granted defendants' motions to dismiss and dismissed with prejudice plaintiffs' TAC as to certain individual defendants.
On July 30, 2014, the United States Court of Appeals for the Ninth Circuit issued an Opinion reversing the judgment of the District Court and remanding this case for further proceedings.
Plaintiffs and certain Defendants entered into a Stipulation of Settlement on August 1, 2016. This Settlement was preliminarily approved by the Court on September 13.
Pursuant to a Stipulation between the parties, the Court ordered the dismissal of issuer defendant from this case on September 12, 2016.
On April 11, 2017, the Court granted final approval of the Settlement.