The Polish development studio CD Projekt Red is being sued by a law firm over its game Cyberpunk 2077. They believe that the developers misled investors with statements about the condition of the game on PS4 and Xbox One. CD Projekt Red states: They intend to vigorously defend against such accusations.
This is what CD Projekt says now: On December 25, CD Projekt published a statement on their website. It is directed at investors.
In the statement, CD Projekt Red informs the investors that a class action lawsuit has been filed against them in California. They received confirmation from the law firm on December 25 that this class action lawsuit has indeed been filed. The lawsuit was filed on behalf of a group of investors who hold securities in CD Projekt Red traded in the USA.
This class action lawsuit asks the court to examine whether the company and management employees made statements in connection with the release of Cyberpunk 2077 that misled investors and ultimately resulted in damages to the investors.
The plaintiffs would not specify how high the damages are.
CD Projekt Red states: They will “vigorously” defend against all such accusations.
Which securities are involved?
It concerns two securities associated with CD Projekt Red. They are designated by ticker symbols:
- The stock “OGTLY” fell from a peak of $31 on December 4 to $18.35 on December 24
- The stock “OTGLF” fell from a peak of $120.05 on December 5 to $75 on December 24.
Essentially, the securities were hot before the release of Cyberpunk 2077 and fell sharply as the difficulties of the game on PS4 and Xbox One became apparent.
“There is no problem with Xbox One PlayStation 4, to be honest”
What is behind the lawsuit? The lawsuit from the law firm “The Rosen Law Firm” cites a number of statements by CD Projekt Red to investors that are considered misleading in the complaint to the district court in California:
- In January 2020, it was stated that Cyberpunk 2077 was “complete and playable” — This statement came when CD Projekt Red postponed the release date from April to September
- In September 2020, representatives of CD Projekt Red said: Cyberpunk 2077 was “on schedule” for a release on November 19. Players could play on “next-gen” consoles on day one
- In October, during the last delay: The game was certified on “current-gen” consoles from Sony and Microsoft and only needed “the very last optimization processes.” They did not want to say that there was a problem with Cyberpunk 2077 on PS4 and Xbox One, but: “There is no problem with Xbox or PlayStation 4, to be honest.”
- In November, CD Projekt emphasized how happy they were with the positive impressions from journalists about Cyberpunk 2077
- In another conference call, one of the defendants said: “We believe the game runs great on every platform.”
All these statements are deemed “false in substance and/or misleading” by the plaintiffs.
The plaintiffs then explain how far the stock of CD Projekt Red dropped when it became known how poorly Cyberpunk 2077 ran on PS4 and Xbox One and that Sony and Microsoft even offered refunds.
Cyberpunk 2077 was delayed three times and still seems to have been released too early. This shows how difficult long-term scheduling can be for such mammoth projects. However, players also do not like it when a game they are looking forward to is delayed:
Cyberpunk 2077: Disappointed players threaten to kill the developers
