Yesterday I posted an article about the new lawsuit being levelled against EA and now some more juicy details have emerged. While I’m definitely no lawyer I have to say this is really starting to look suspicious.
You can browse through the official lawsuit her,e but the part that is most suspicious has been highlighted by Gamespot – and here it is. This image showcases what shares were sold by leading EA executives a few weeks prior to the release of Battlefield 4.
In summary a group of 5 EA employees dumped over $4.8 million worth of stock over a period of just three weeks. Now the lawyers are claiming that this was done because these guys knew that Battlefield 4 had some serious issues and were dumping stock before the stock price started dropping.
But if we take a little look back then this case starts to look a little weak. At the time of writing the EA share price is sitting at $23.44 which is only $3 less than when the executives sold their stock and $3 is a lot when you are talking huge sales…but what if we look further back?
Back in January this year the stock price was sitting at a less than exciting $14.88 and back in July last year it was even worse at $11.41. So as smart business people is it really suspicious that they sold a lot of stock while the price was higher than it has ever been in the last 5 years.
To me, though this doesn’t show anything other than a couple of people cashing out at the top of the ride and nothing to do with the problems that Battlefield 4 is currently experiencing.
Last Updated: December 20, 2013
Lego Witcher of the Squirrels
December 20, 2013 at 08:37
I don’t think it’s suspicious, it was just bad timing on their part lol.
I would have sold at the same time if I had in the region of 50000 or more shares in EA… it’s just good business… and setting yourself up for a good christmas season 😛
Alien Emperor Trevor
December 20, 2013 at 08:39
Yip, that sounds way more plausible than insider trading. Plus they don’t say how many shares those guys are still holding.
Phil van Staden
December 20, 2013 at 09:08
I disagree, if you sell your shares just before the release of one your company’s, if not the biggest franchise and it is a success, your share price will show a dramatic increase in a few short weeks (if the launch was a success) and then you’ll make even more?
Lego Witcher of the Squirrels
December 20, 2013 at 09:24
That’s a correct assumption, but if you’re sitting on over 200k-500k shares, selling 50k of them on a 5 year high wouldn’t hurt you at all, and you could pass off another 50k after the successful release of your latest game franchise and the price listing increases.
It’s just making sure you don’t lose too badly if the price drops, and readying yourself for the possibility of selling again a few weeks/months after release.
Phil van Staden
December 20, 2013 at 09:33
It’s your last sentence which the lawyers will exploit, why would your biggest launch cause a price drop unless you suspect that something isn’t fine. These directors earn a shitload they don’t need to sell a few shares to make a small margin.
Mark Treloar
December 20, 2013 at 15:31
Except if the game had been delayed for not being ready the share price would have dropped. Its a lose / lose situation.
CAE9872
December 20, 2013 at 08:44
Yip the financial reasons for selling outweigh any “conspiracy” theories. We get taught in life…”buy low, sell high”. That’s what they did.
Battlefield 4 launch has been a travesty of gaming justice perhaps (I don’t know as haven’t played it yet) but share price was unlikely to change much as everyone knew it was coming out i.e. the market had already factored in its release. Sure share price may have dipped a little on the back of the negative press but anyone buying EA stock knows there are a whole bunch of annual releases as well which tempers the negatives! Rivals has been a great release by all accounts. So good and bad…
Jonah Cash
December 20, 2013 at 08:45
Got a SMS from BT Games on Wednesday to inform me that my pre order for their second batch of PS4’s has been delayed till Monday…. I phoned over 50 places and found one at a Game store, climbed in my car drover there and bought it!! Fifa 14 is in a different league on PS4, and I bought Killzone yesterday and WOW!!! I don’t like FPS games, but even I will concede that it is a seriously good looking game with not too much flaws!!
CAE9872
December 20, 2013 at 09:05
Killzone has supermodel looks that’s for sure! Glad to hear FIFA 14 is good – want to get that (and Madden – I like me some of that Merican football).
Jonah Cash
December 20, 2013 at 10:35
Let me know what you think of Madden, last one I played was 2002…. Fifa is truly better on PS4!! The ball doesn’t go through people anymore and non of the crap of free headers at corners!! I am so much happier again………..
Hammersteyn
December 20, 2013 at 09:10
Agreed, the graphical details in Killzone is stunning.
Jonah Cash
December 20, 2013 at 10:36
Oi, what is your PSN ID? Or are you single player forever and no friends list?
Hammersteyn
December 20, 2013 at 10:48
hammer_steyn 😉
CodeName Tailgunner
December 20, 2013 at 09:15
drover there
very efficient
I like it
Alien Emperor Trevor
December 20, 2013 at 09:18
THAT GUY!
CodeName Tailgunner
December 20, 2013 at 09:24
C’mon man I was trying to be nice and complement him and everything.
Still knew it was coming.
🙂
Alien Emperor Trevor
December 20, 2013 at 09:36
lol @ tweet
Jonah Cash
December 20, 2013 at 10:33
This……..
Gr8_Balls_o_Fire
January 6, 2014 at 11:45
You have sold me on Killzone. I am not an FPS fan either. I got Battefield 4 and Assassin’s 4 but still waiting for my console 🙁
I didn’t get Fifa coz my friends are not buying a PS4.
Sir Rants A Lot Llew. Jelly!!!
December 20, 2013 at 08:48
Buying low and selling high?? *GASP* Must be a conspiracy lol.
I do believe that part of their choice to sell then and not after BF4 released was also a smart business choice as most games that are online focused cause a slight dip in stock price before going up due to the initial unhappiness of users due to server issues and what not.
It was all business choice related. I think the lawsuit is just sour grapes that the game was released so shoddy and it really is the investor’s faults who all pushed and pushed for the game to release on schedule instead of allowing the devs to delay a little to polish it up. Now they all want someone to blame. That’s all
JJ's horrible secret (John)
December 20, 2013 at 08:53
Agreed. Still don’t like EA though
Sir Rants A Lot Llew. Jelly!!!
December 20, 2013 at 08:58
Oh don’t get me wrong.I’m not defending EA. They’ve made some crappy choices, destroyed certain franchises, etc;
I just think that we shouldn’t burn them at the stake for this that’s all. But somewhere along the line EA and its investors/shareholders/suits need to catch a wake up and realise they are shooting the ship full of holes and it’s going to sink unless drastic measures are taken and their viewpoint changed from “how much money can we make” to “How can we make this game so amazing for people that we won’t even need greedy tactics to try and make back the huge amounts of money we spent because the games are flying off the shelves faster than we can get them distributed”
JJ's horrible secret (John)
December 20, 2013 at 09:00
Yes, agreed. Was a bit of an IPO effect and they clearly overvalued it, EA’s not the main-konyn to blame in all of this. This is just a snowball of bad decisions by everyone involved.
CAE9872
December 20, 2013 at 09:08
Very good point – they must be careful of Activision syndrome. Have CoD and Skylanders and that’s it besides some movie tie-ins no-one cares about. As an accountant I do find it hard how Activision balance the books on back of 2, admittedly massive, franchises. My point being – what happens when they eventually run their course? Which will happen.
At least EA have many more strings to their bow.
JJ's horrible secret (John)
December 20, 2013 at 08:53
What EA games are on the Steam sale? So I know what games to avoid buying.
Umar of The Rebellion
December 20, 2013 at 08:59
Seems legit hey in all honesty, it just happens to coincide with this whole debacle….
Ultimo_Cleric N7
December 20, 2013 at 10:14
BIOWARE, GET OUT WHILE YOU CAN!!!
Willem Swanepoel
December 20, 2013 at 10:20
MERICANS!!! They will try to find anything to sue people for money … sigh
Anyway, I wish I had shares that went up double on its value in one year … sheessh. I will also cashing for a good holiday 😉
Brenz
December 20, 2013 at 10:37
Ever so slightly suspicious…..
Matt
December 20, 2013 at 10:38
Reminds me a lot of Enron. The big guys got out before the ship started sinking.
Sk3tz0
December 20, 2013 at 10:54
Sad.. they use to make such awesome games in the 90s..
HvR
December 20, 2013 at 11:07
The only thing this company and the one in the early 90’s has in common are the letters E and A.