NEW YORK — After rumors that there would be a class-action lawsuit against the developer of Cyberpunk 2077, it is now official. CD Projekt S.A., the parent company of CD Projekt RED, will be seeing their day in court.
A recent filing from New York-based Rosen Law firm alleges that the company has violated U.S. securities laws.
A press release from the law firm states that the suit is filed on behalf of shareholders of the company’s stock. However, it only applies to shareholders buying stock throughout certain dates in 2020. Regarding specifics, the class action suit is focusing on stockholders buying shares between Jan. 16 and Dec. 17 of this year.
The suit’s intent is to “recover damages for CD Projekt investors” under securities laws set in the U.S. It further alleges that the company made “false and/or misleading statements” to investors. Additionally, it alleges that the company failed to disclose the issues surrounding the game.
The game has been the subject of many complaints, being virtually unplayable on current-gen Xbox and PlayStation systems. However, there have also been issues for PC users as well. This is a result of an unfinished game release with an enormous number of bugs. Additionally, there is the presumption of bad ports from PC to other consoles.
Game removed from PS Store, full refunds offered on all platforms
In a prior report, we would report that Sony would remove the game from the PlayStation Store. Additionally, Sony, Microsoft, and CD Projekt were offering full refunds for the game. Currently, there have no reports regarding purchases for PC through such points-of-sale including Steam.
The suit comes after a previous report that lawyers and investors in their corporate headquarters in Warsaw, Poland were “circling the situation”. Currently, there has been no decision on any potential action by Polish securities officials.
Shareholders would lose roughly $1 billion in share value as a result of these issues. However, it did not stop the game from selling over 13 million copies in the process. Additionally, they would recoup their development and marketing costs with pre-orders alone.
There has yet to be an official number as to how many digital copies were returned for refunds.
The suit alleges four key points in seeking action against the company.
- Cyberpunk 2077 was “virtually unplayable” on current-gen consoles due to an enormous number of bugs.
- As a result, Sony would remove Cyberpunk 2077 from the PlayStation Store. Additionally, Sony, Microsoft, and CD Projekt were issuing full refunds for digital games. Additional retail outlets would include Best Buy.
- CD Projekt will suffer from reputational and pecuniary harm as a result of this erroneous release. This is especially true when there should have been a delay of several more weeks to fix the bugs prior to release.
- Defendant statements regarding the business, its operations, and prospects were materially false and/or misleading. Furthermore, it stipulates a lack of reasonable basis at all times of relevancy. When the truth entered into the light as the game entered the market, investors would suffer fiduciary damages as a result of their deception.
The class-action case page states that “CD Projekt shareholders have an opportunity to recover their investment losses.”
It applies to anyone who purchased either of CD Projekt’s stocks “OTGLF” and “OTGLY”. Both have lost stock value since early December.
The former has fallen from its Dec. 7 peak at $120.05 per share. Trading Tuesday would open at $75.00 and would close up $1 to $76.00 per share.
The latter has fallen from its $31.00 peak on Dec. 3. Trading would open at $19.19 per share, closing down on the day by 22 cents to $18.97.
CD Projekt plans to defend themselves
The developer would publish a news release on Christmas, confirming the lawsuit.
“The company will undertake vigorous action to defend itself against any such claims,” the statement to investors reads.
It’s highly unlikely that either party will have any closure on the issue anytime soon. This is due to class-action lawsuits often being a lengthy, drawn-out process.
For now, it will be up to the judges in U.S. district court to determine whether the issue is indeed eligible for class-action deliberation. The case will be heard in the Central District of California.
However, by the time the lawsuit is in court and attains resolution, Cyberpunk 2077 will likely already be different as a result of ongoing patches.
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Jake Leonard, a broadcast media and journalism veteran, is the editor-in-chief of Heartland Newsfeed. Leonard is also GM and program director of Heartland Newsfeed Radio Network, wrestling editor and contributing writer for Ambush Sports, a contributing writer for My Sports Vote and Midwest Sports Network, and a former contributor to Bleacher Report and Overtime Heroics. He resides at home in Nokomis, Ill. with his dog Buster.