Investors Say SeaWorld Knew ‘Blackfish’ Movie Led to Ticket Sale Decline

In response to SeaWorld’s motion to dismiss a proposed class action lawsuit, the lead plaintiff told a California federal court that the company withheld information that a popular 2013 documentary led to a decline in ticket sales.

Plaintiff Lou Baker, a SeaWorld shareholder, argued that the company knew that the movie “Blackfish,” a film about alleged mistreatment of orca whales at the amusement park, contributed to an attendance drop during 2013 and 2014.

Baker accused the company of clearly knowing the documentary would negatively affect its business, but withheld that information from company investors.

“Defendants’ unequivocal denials also cannot be reconciled with well-pled facts detailing SeaWorld’s extensive public relations (“PR”) counterattack on ‘Blackfish,’ which was widely understood by the market to be a response to SeaWorld’s tanking attendance,” the recent motion said.

Baker’s original lawsuit, filed in September 2014, accused SeaWorld of hiding the fact that “Blackfish” had significantly affected park attendance. The documentary originally premiered at the Sundance Film Festival in January 2013 and was shown on CNN later that year.

The lawsuit also alleged that SeaWorld did not disclose any of the misconduct allegations outlined in the film, including a claim that SeaWorld housed a whale that killed or injured several of its trainers, during its initial public offering back in April 2013.

U.S. District Judge Michael M. Anello dismissed Baker’s lawsuit in March 2016 and allowed him leave to amend the lawsuit.

Judge Anello said that the investors’ accusations that SeaWorld inflated its stock price by concealing the attendance drop allegedly caused by the 2013 documentary did not have enough facts proving that SeaWorld purposely misled shareholders.

In response, SeaWorld argued that the newly amended complaint continues to fall short in establishing a direct correlation between park attendance decline and the release of the documentary.

Baker argued that SeaWorld’s records indicated that park attendance had declined during the proposed class period, while attendance at nearby amusement parks increased, and SeaWorld’s attendance decline did not appear to be affected by weather or other external factors as SeaWorld claimed.

“To find otherwise would require improperly crediting an implausible opposite inference that cannot be drawn from the facts pled — that the mounting public outcry and direct attacks on SeaWorld’s brand during the CP, including hundreds of thousands of individuals actively promoting the boycott of SeaWorld parks and/or opposing SeaWorld’s business practices and brand, played no role whatsoever in SeaWorld’s CP attendance declines,” the plaintiffs maintain.

SeaWorld did manage to dodge another potential class action lawsuit this year that was also allegedly sparked by the “Blackfish” documentary. The plaintiff in that proposed class lawsuit alleged that she would not have purchased SeaWorld tickets had she known how the theme park was treating its animals.

The judge dismissed the lawsuit with prejudice, ruling that there was insufficient evidence that SeaWorld misled and deceived consumers.

The proposed investor class is represented by Ethan T. Boyer and David J. Noonan of Kirby Noonan Lance & Hoge LLP; Eric L. Zagar, Joshua E. D’Ancona and Joshua A. Materese of Kessler Topza Meltzer & Check LLP; Jeffrey J. Angelovich and Bradley E. Beckworth of Nix Patterson & Roach LLP and Susan Whatley.

The SeaWorld Shareholder Class Action Lawsuit is Baker v. SeaWorld Entertainment Inc., et al., Case No. 3:14-cv-02129, in the U.S. District Court for the Southern District of California.