Evolution, the world’s most prominent supplier of live dealer games for online casinos, received some more bad news as law firm Pomerantz has announced the filing of a class action lawsuit against the company for alleged securities fraud.
This is the second class action lawsuit against Evolution after another one was filed at the end of January by Federman & Sherwood in the United States District Court for the Eastern District of Pennsylvania.
The new lawsuit accuses the global gaming giant of securities fraud and the law firm which filed it alleges that Evolution has been engaging in unlawful business practices between 2019 and 2023. The lawsuit alleges that there were several incidents during that period that had a major impact on the company’s share prices.
Among the listed incidents we can find a report compiled by Analyst Generation Limited in January 2022 and made available only to certain investors. The respective report claimed that an important part of the company’s revenue could be “at risk” in case of future regulatory clampdowns and also that Evolution could have generated revenue from illegal gambling activities. After that report was released the share prices of Evolution dropped by 14.68 percent over three trading sessions.
Another accusation listed in the lawsuit claims that share prices registered a decrease of 7.61 percent after the company released its financial results for the third quarter of 2023. The results were not bad at all but in the subsequent earnings call the company revealed that it was facing delays in the opening of new live casino studios and also that its RNG segment was not growing as fast as expected. Evolution has not yet commented on the accusations.
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