NEW YORK, June 2, 2005 (PRIMEZONE) -- Murray, Frank & Sailer LLP has filed a class action lawsuit in the United States District Court for the Southern District of New York on behalf of all securities purchasers of Gravity Co., Ltd. ("Gravity" or "the company") (Nasdaq:GRVY) between February 7, 2005 and May 12, 2005, inclusive (the "Class Period").
The Complaint charges Gravity and certain of the Company's executive officers with violations of federal securities laws by issuing materially false and misleading financial statements to the investing public that caused the price of the Company's stock to be artificially inflated. Gravity develops and distributes online games and related businesses within Korea and other countries worldwide. The Company's primary product, Ragnarok Online, is commercially available in 19 markets. Historically, revenues from Ragnarok Online have accounted for the majority of the Company's revenue, with 95% of the Company's revenue prior to the IPO attributable to that product.
The Complaint alleges defendants failed to disclose and misrepresented material adverse facts, including that: (a) Ragnarok Online was experiencing a material decline in customer demand and increased competition in the marketplace, which caused Ragnarok Online's revenues to steeply decline; (b) Gravity's mobile animation business was in such a dire state that it was no longer capable of producing a viable revenue stream for the Company; and (c) the Company's statements about substantial growth potential for online gaming were lacking in any reasonable basis when made because Gravity's royalties and license fees (for online gaming) were negatively impacted by unfavorable trends in China which caused a decline of Ragnarok Online revenues.
On May 12, 2005, Gravity announced disappointing financial results for first-quarter 2005 which shocked the market, causing Gravity's share price to tumble $3.64 per share -- more than 39% -- to close at $5.60 per share on May 13, 2005.
Murray, Frank & Sailer LLP and its predecessor firms have devoted its practice to shareholder class actions and complex commercial litigation for more than thirty years and have recovered hundreds of millions of dollars for shareholders in class actions throughout the United States.
If you purchased or otherwise acquired Gravity securities on any world exchange between February 7, 2005 and May 12, 2005, and sustained damages, you may, no later than July 18, 2005, move the Court to serve as lead plaintiff. Shareholders outside the United States may also join the action, regardless of which exchange was used to purchase the securities. To serve as lead plaintiff, however, you must meet certain legal requirements. You can join this class action as lead plaintiff online at http://www.murrayfrank.com/CM/NewCases/NewCases.asp. If you would like to discuss this action, this announcement, or your rights and interests, please contact plaintiff's counsel Eric J. Belfi or Christopher S. Hinton of Murray, Frank & Sailer LLP.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.