SAN FRANCISCO (CN) - After a very quick hearing on Thursday morning, a federal judge gave final approval to a class action settlement of claims that video game developer Zynga artificially inflated its share prices.
Lead plaintiff David Fee claimed in the 2012 lawsuit that Zynga executives, aware of the company's poor financial condition, sold their shares in the company for hundreds of millions of dollars.
The plaintiffs said the alleged scheme allowed the executives to shift the company's revenue losses from the first quarter to the second quarter of 2012, which artificially inflated the price of Zynga stock during the first quarter.
By the time Zynga disclosed its true financial status, its stock price fell 37 percent in a single day, according to U.S. Magistrate Judge Jacqueline Corley's October 2015 order preliminarily approving the settlement.
The approved settlement fund is $23 million, and class members will receive a pro rata share of the fund based on their purchases of the Zynga stock at issue, according to Corley's final approval order.
The estimated distribution will be $0.15 per share, Corley said.
Jeffrey Norton, who represents the plaintiffs, told Courthouse News in October 2015 that he expects about 100,000 claimants.
About 25 percent of the settlement fund - $5.7 million - will go to attorneys' fees, and about $189,000 will cover litigation expenses.
Norton is with Newman Ferrara, in New York City.
Zynga is represented by Anna White with Morrison & Foerster in San Francisco.
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