Game maker under fire
Take-Two has received grand jury subpoenas from the Manhattan district attorney requesting a wide variety of information.
"If you look at all of the data points they brought up it seems to be tied to stock options and executive compensation,'' said Janco Partners analyst Mike Hickey.
The district attorney specifically requested documents relating to the "hot coffee" scene in "Grand Theft Auto: San Andreas", which can only be viewed after downloading a special program. The scene was discovered last summer and the ratings board quickly put an "adults only" label on the video game. The game was then pulled from retail shelves, which cost Take-Two millions of dollars in revenues and lawsuits from shareholders.
Take-Two's finanancial practices have also come under scrutiny. The DA has subpoenaed documents referring to executive compensation, partnerships, earnings reports, acquisitions and its dealings with and ultimate termination of accounting firm PricewaterhouseCoopers LLP.
"The one sticking point that most people have with the company is management,'' Hickey said. "Someone's going to be held accountable at some point."