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SeaWorld Finally Fesses Up to 'Blackfish' Documentary Impact

Chris Lange

Published: September 19, 2018 11:15 am

Last Updated: January 11, 2020 5:39 pm

SeaWorld Entertainment Inc. (NYSE: SEAS) has long been at the center of controversy in regards to whether the company treats its animals humanely. Many would argue that this company’s reputation wasn’t the best in this case, and a recent documentary brought this to light.

The company attempted to combat the information in the documentary “Blackfish” but ultimately ended up misleading investors and making false statements, according to the U.S. Securities and Exchange Commission (SEC).

As a result, the SEC has issued and settled fraud charges with SeaWorld and its former CEO for misleading investors. SeaWorld’s former vice president of communications also agreed to settle a fraud charge for his role in misleading investors.

The amount being settled is only $5 million, which is a drop in the pool for SeaWorld, with its market cap of $2.7 billion. But more importantly, the company is held responsible for its actions.

“Blackfish” criticized SeaWorld’s treatment of its orcas (killer whales) and received significant media attention as the film became more widely distributed in the latter half of 2013. The SEC’s complaint alleged that from roughly December 2013 through August 2014, SeaWorld and former CEO James Atchison made untrue and misleading statements or omissions in SEC filings, earnings releases and calls, and other statements to the press regarding Blackfish’s impact on the company’s reputation and business.

According to the SEC’s complaint, on August 13, 2014, when SeaWorld for the first time acknowledged that its declining attendance was partially caused by negative publicity, SeaWorld’s stock price fell, causing significant losses to shareholders.

Shares of SeaWorld were last seen down about 1.5% at $30.73 on Wednesday, with a consensus analyst price target of $24.90 and a 52-week range of $10.42 to $32.47.