SeaWorld Entertainment is set to pay investors $65m as a federal judge has approved the settlement six years after the company was sued for allegedly deceiving stockholders about the negative impact of Blackfish on theme park attendance.
According to Los Angeles Times, a settlement of the 2014 class-action lawsuit was reached in February, but it couldn’t go into effect until it was formally approved by US District Judge Michael Anello.
Anello said the settlement is “fair, reasonable and adequate” and noted that in 2013 “social media reaction to Blackfish remained elevated”. He added that consumers “contacted SeaWorld and vowed never to visit its parks because of Blackfish“.
In addition, Blackfish prompted partners and sponsors to end or table partnerships and promotions with SeaWorld.
Partnerships ended with SeaWorld over Blackfish
SeaWorld bosses acknowledged in 2014 that attendance had been impacted by “demand pressures related to recent media attention surrounding proposed legislation (banning captive breeding of killer whales) in the state of California”.
However, investors in the litigation claimed that shareholders lost nearly 33 percent of the value of their SeaWorld stock in a single day when SeaWorld finally made the acknowledgement on August 13, 2014.
As part of the settlement, SeaWorld does not admit any wrongdoing. The company consistently said that there was no evidence that it failed to disclose internal information showing that the Blackfish documentary was impacting attendance.
Last year, SeaWorld attempted to have the class-action case thrown out, but Anello ruled against the company and said that a trial should go ahead.
SeaWorld does not admit any wrongdoing
Anello has also approved requested attorney fees of $14.3 million and litigation expenses of $2.1 million.
Shareholders who purchased SeaWorld stock between August 29, 2013 and August 12, 2014 and held onto the investment until at least August 13, 2014 are eligible for a share of the settlement.
The claims administrator has sent out more than 20,000 notices to prospective class members in order to start the process of calculating distribution of the settlement.
After a final determination has been made for distributing the funds, attorneys for the plaintiffs will file a motion for approval.
SeaWorld previously said it will fund the total settlement with $45.5 million in insurance proceeds, plus $19.5 million in company cash.
Back in April, SeaWorld took proactive financial steps to protect its customers, employees and animals during park closures over COVID-19.