Stull, Stull & Brody announced that a class action lawsuit was filed against Coinstar, Inc. by Joseph H. Weiss in the United States District Court for the Western District of Washington (February 4, 2011, docket number 2:11cv00202).
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Unedited press release follows:
Class Action Filed Against Coinstar Inc. on Behalf of Shareholders Who Purchased or Acquired its Securities Between October 28, 2010 and February 3, 2011, by the Law Firm of Stull, Stull & Brody
NEW YORK–A class action lawsuit was filed in the United States District Court for the Western District of Washington on behalf of purchasers or other acquirers of Coinstar, Inc. (“Coinstar” or the “Company”) (Nasdaq: CSTR) securities between October 28, 2010 and February 3, 2011, inclusive (the “Class Period”).
Coinstar primarily has two business segments: (i) DVD Services, through its wholly-owned subsidiary Redbox, which offers self-service DVD rentals through 28,400 kiosks located throughout the United States; and (ii) Coin Services, which offers self-service coin-counting services through over 18,900 machines located throughout the United States, Canada, Puerto Rico, Ireland, and the United Kingdom. The Complaint charges that the Company and certain of its officers and directors violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10-b(5). The action alleges that defendants issued a series of materially false and misleading statements concerning the Company’s business prospects and financial condition.
Specifically, the Complaint alleges that, throughout the Class Period, Defendants materially misled the market to believe that: (i) Coinstar was operating according to plan; (ii) its revenues were not adversely affected by the 28-day delay (the “28-day delay”) imposed on the Company by several movie studios in late April 2010; (iii) the Company was effectively managing its inventory; and (iv) Coinstar maintained adequate systems of internal operational and financial controls, such that Coinstar’s public statements and reported guidance was true, accurate, and reliable. However, as alleged in the Complaint, the Company, actually had, among other things: (i) decreased sales to customers as a result of the 28-day delay; and (ii) poor inventory management and controls resulting in the removal of material amounts of old inventory and an overstock of higher priced “Blue-ray” DVDs. The Complaint alleges that as a result of these problems, on February 3, 2011, the Company reported that its financial results for its Fourth Quarter and full year 2010 results would be well below its previously announced guidance and analyst expectations. The Complaint further alleges that as a result of Defendants’ actions, plaintiff and the Class were damaged.
Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Stull, Stull & Brody, which has significant experience and expertise in prosecuting class actions on behalf of investors.
If you purchased Coinstar securities between October 28, 2010 and February 3, 2011, inclusive, you may be a member of the class and have until March 25, 2011, to move the Court to serve as lead plaintiff, if you so choose. In order to serve as lead plaintiff, however, you must meet certain legal requirements. To be a member of the class, however, you do not need to take any action at this time. Should you decide to seek appointment as a lead plaintiff, you may retain Stull Stull & Brody, or counsel of your choice.
If you have any questions concerning this notice or your rights or interests with respect to this matter, please contact Patrice Bishop of Stull, Stull & Brody toll free at 888-388-4605 or via e-mail at firstname.lastname@example.org or visit the firm’s web-site at www.ssbny.com.